Rising Oil Prices May Push India’s Inflation to 4.8% Next Fiscal

India rsquo;s CPI inflation is projected to rise next year as higher crude oil prices, fragile global growth and weaker monsoon expectations combine to pressure the macroeconomic outlook, according to a new assessment by 360 ONE Capital that also flags wider fiscal and external deficits for FY27, ANI reported.The report links the softer outlook mainly to the conflict in West Asia and a downgraded Southwest Monsoon 2026 forecast, which together threaten energy supplies, farm output and rural demand.

It notes that India rsquo;s domestic demand and government spending still support growth, but new risks are building around inflation, trade balances and public finances.India CPI inflation outlook under higher crude oil and conflict risksThe report rsquo;s revised base case assumes geopolitical tensions in West Asia cool by mid-June, yet crude oil averages USD 90/bbl in FY27.

Under these conditions, 360 ONE Capital expects India rsquo;s CPI inflation to increase by about 70 basis points to 4.8 per cent, up from an earlier projection of 4.1 per cent.The same scenario points to slower real activity.

The report now sees GDP growth easing to 6.3 per cent in FY27, compared with a previous estimate of 6.7 per cent.

It also warns that the fiscal deficit could widen to 4.6 per cent of GDP instead of 4.4 per cent, and that the current account deficit may stretch to 2.1 per cent of GDP from 1.3 per cent.

Iran Assures No Nuclear Weapons, Says Trump; New US Proposal Under ReviewIndia CPI inflation risks from crude oil supply routes and energy exposure360 ONE Capital underlines that India rsquo;s economic momentum, built on private consumption and public investment, remains stable for now.

However, it stresses that supply routes through the Strait of Hormuz are critical, since India sources nearly 50 per cent of LPG and around 30 per cent of natural gas needs through this corridor, leaving the economy vulnerable to any long disruption.The report highlights that the net petroleum import bill has declined from 5.5% of GDP in FY14 to around 3.0% in FY25,....