India may moderately raise retail fuel prices in November, a step Oxford Economics regards as the last realistic window before campaigning for early-2027 state elections intensifies. Lead economist Alexandra Hermann Prasad made the call in a note published on Thursday. Retail pump prices rose 7.5 percent cumulatively in May, the only period they moved in response to the Middle East war.
Oxford Economics says a November increase could be about half the size of that May rise. Under that scenario it projects India retail inflation at 6.2 percent in the October-December quarter and 6.5 percent in January-March 2027. Without a fuel price increase, it says its inflation projections could be revised down by 10 to 30 basis points.
Inflation and the central bank
The Reserve Bank of India raised rates by a quarter point in October. Its own projections put inflation at 6 percent in October-December and 5.7 percent in January-March, against a target range of 2 to 6 percent. Oxford Economics expects inflation to stay elevated, and it sees the RBI possibly hiking by 25 basis points at each of its December and February meetings.
Retail inflation reached 5.54 percent in September, the highest since late 2024, up from 4.83 percent in August.
Currency and growth
Prasad said intervention alone is unlikely to deliver lasting currency stability, given elevated oil prices and persistent external financing pressures. Expanding protests over alleged electoral malpractice have so far centred on Delhi. Prasad described that disruption as too limited to materially affect growth.
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Source: Reserve Bank of India · Oxford Economics
