GoI Kept Inflation Target at 4% for 2026-31 Period
In March 2026, the Government of India (GoI) kept the inflation target unchanged i.e. 4% for the next 5 years (from April 01, 2026 to March 31, 2031), ,marking the 2nd consecutive instance of inflation targets unchanged.
In March 2026, the Government of India (GoI) kept the inflation target unchanged i.e. 4% for the next 5 years (from April 01, 2026 to March 31, 2031), ,marking the 2nd consecutive instance of inflation targets unchanged.
- As per the official notification issued by the Department of Economic Affairs (DEA), Ministry of Finance (MoF), the decision was taken by the MoF in consultation with the Reserve Bank of India (RBI), in exercise of powers given by Section 45ZA of RBI Act, 1934 (2 of 1934).
Key Details:
Upper and Lower Limit: The notification has clarified that upper tolerance level of inflation at 6% and lower tolerance level at 2% for the same time period (i.e. from April 2026 to March 2031).
Inflation Target Framework: The inflation target is set under India’s Flexible Inflation Targeting (FIT) framework, introduced in 2016. This framework mandates the Reserve Bank of India (RBI) to maintain inflation at a specified level, with a tolerance band.
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