RBI flags concerns over tricky economic calculus

The Reserve Bank of India (RBI) on Wednesday flagged concerns over tricky economic calculus, US President Donald Trump's tit-for-tat tariffs, and escalating global trade wars.

- Palazhi Ashok Kumar

The apex bank said, India is not ignoring geopolitical realities, and trade-related uncertainties are unfolding every moment. There has been a significant moderation in inflation. The prevailing global uncertainties and tariff-related developments are likely to decelerate domestic economic growth in the second half of FY25-26 and beyond.

Meanwhile, the RBI kept its policy rate unchanged, signalling room to lower rates in December as it continues to evaluate the impact of tax cuts and reciprocal US tariffs on the economy. The current macroeconomic conditions and the outlook opened up policy space for further supporting growth.