The Indian economy is showing signs of gathering momentum in the second quarter, although inflation is expected to remain above the central bank’s target of 6%, according to an article in the Reserve Bank of India’s (RBI) monthly bulletin. The article, authored by a team led by RBI Deputy Governor Michael Debabrata Patra, stated that while there is a significant uptick in inflation due to soaring food prices, the risk of stagflation (high inflation coupled with weak growth) remains low. Despite the global recovery slowing down, the Indian economy is expected to gain momentum in the second quarter of the fiscal year 2023-24, supported by domestic drivers such as private consumption and fixed investment. The RBI’s Monetary Policy Committee (MPC) has maintained its economic growth forecast at 6.5% for the fiscal year.