Households expect 10% inflation a year ahead, up from 9.4%
RBI's latest surveys show households expecting higher prices and slightly less confident, while forecasters raised 2026-27 growth to 7.1% and firms grew more upbeat.
Official title: RBI releases the results of Forward Looking Surveys · Press Release 2026-2027/1270
What happened
RBI released eight surveys of households, forecasters, factories, service firms and banks. The results reflect respondents' views, not RBI's. Urban households surveyed in 19 cities in September felt current inflation at 8.4%, up from 7.8%, and expect 10.0% a year from now, up from 9.4%. Rural households expect 7.9%. Confidence slipped: the urban current situation score fell to 87.9 from 88.3 and the rural one to 90.6 from 91.7, both below the neutral 100, though people remain hopeful about the year ahead.
Professional forecasters raised their 2026-27 growth forecast by 0.5 percentage points to 7.1% and expect consumer inflation of 5.1% for the year, rising to 5.9% in October to December. Factories used 74.6% of their capacity in April to June (76.3% after adjusting for seasons), and new orders rose 14.3% over a year.
Manufacturers turned more upbeat: the business assessment index rose to 104.4 and expectations for October to December to 126.3. Banks reported stronger loan demand across most sectors and slightly easier loan terms. Service and infrastructure firms reported better business but strong cost pressures. Many firms expect to raise selling prices.
What it means for you
Households expect prices to keep rising quickly, and both firms and forecasters see inflation going up in the coming months. Budget for higher costs. Rising inflation expectations make RBI less likely to cut interest rates soon.
What it means for businesses
Demand is improving and banks are willing to lend. Input costs remain high and many firms plan price increases, so expect pricing pressure from suppliers.
Links in this release, explained
- Urban Consumer Confidence Survey (UCCS) – September 2026
Full results of the September 2026 urban consumer confidence survey of about 6,000 people in 19 cities, on how they see jobs, incomes, prices and spending now and a year ahead.
www.rbi.org.in/scripts/PublicationsView.aspx?id=24093 - Inflation Expectations Survey of Households (IESH) – September 2026
Full results of the September 2026 household inflation survey: how much price rise urban households feel now and expect in three months and a year.
www.rbi.org.in/scripts/PublicationsView.aspx?id=24089 - Rural Consumer Confidence Survey (RCCS) – September 2026
Full results of the September 2026 rural consumer confidence survey of about 8,800 people in rural and semi-urban areas.
www.rbi.org.in/scripts/PublicationsView.aspx?id=24091 - Survey of Professional Forecasters on Macroeconomic Indicators–Results of the 102nd Round
Results of the 102nd round of RBI's survey of 47 professional forecasters on GDP growth, inflation and other indicators.
www.rbi.org.in/Scripts/PublicationsView.aspx?id=24086 - Order Books, Inventories and Capacity Utilisation Survey on the Manufacturing sector for Q1:2026-27
Results for April to June 2026 of RBI's factory survey on new orders, stock levels and how much capacity is being used.
www.rbi.org.in/scripts/PublicationsView.aspx?id=24087 - Industrial Outlook Survey of the Manufacturing Sector for Q2:2026-27
Manufacturers' assessment of business in July to September 2026 and expectations for the following quarters.
www.rbi.org.in/scripts/PublicationsView.aspx?id=24090 - Bank Lending Survey for Q2:2026-27
Bank officials' views on loan demand and lending terms by sector for July to September 2026 and the next quarter.
www.rbi.org.in/scripts/PublicationsView.aspx?id=24092 - Services and Infrastructure Outlook Survey for Q2:2026-27
Services and infrastructure companies' assessment of demand, jobs and prices for July to September 2026 and expectations ahead.
www.rbi.org.in/scripts/PublicationsView.aspx?id=24088 - Previous survey results (August 5, 2026)
The August 5, 2026 release of the previous round of these surveys, useful for comparing results.
rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=63292
Read the original
Press release on rbi.org.in ↗ Official PDF ↗
This explainer simplifies the official text. If anything here differs from the RBI's release, the release is right.