RBI Considers Modifying Inflation Target Policy

The Reserve Bank of India (RBI) is evaluating its inflation targeting framework, seeking public input on whether to maintain the current 4% target or make adjustments. The review comes as the framework’s validity is up for discussion by April 2026, with the RBI inviting feedback on both retaining the 4% goal and potentially altering the 2 percentage-point tolerance band. The central bank’s discussion paper explores whether to continue targeting headline inflation or shift towards core inflation (excluding food and fuel), a measure that has gained traction in recent discussions.