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Economists believe the July inflation uptick is largely driven by food prices, but the rise is not broad-based enough to immediately alter the Reserve Bank of India’s policy stance. While inflation has moved above the RBI’s 4% target for a second consecutive month, it remains within the 2-6 percent tolerance band. Analysts expect the Reserve Bank of India to remain patient as core inflation remains relatively contained. However experts are eyeing the risks from uneven monsoon conditions, higher input costs, fuel prices, geopolitical tensions and global commodity prices. Some economists see the possibility of lending/repo rate hikes later in FY27 if inflation remains elevated, while others expect the RBI to maintain its current stance.