To mirror international crude prices, retail fuel prices would need to be increased by 15%

            Assuming an average of US$110/bbl. in F2023 (based on oil prices as of March 7), India’s headline CPI is anticipated to average 6%. Food inflation rose to 5.9 percent in February, with meat, fish, and eggs leading the way. According to Morgan Stanley, the government can prevent the pass-through of high oil costs. In terms of policy reaction, “we anticipate the RBI to begin monetary policy normalisation with a reverse repo rate rise in the April policy review, followed by a 25bp repo rate hike in the June policy review”, it added.