New Delhi, May 13 -- The pass-through of rising fuel prices to consumers needs to be closely monitored as weather-related risks costs could also put upward pressure on inflation in FY27, according to a report by Bank of Baroda.

India's headline Consumer Price Index (CPI) inflation in April has remained below the Reserve Bank of India's 4 per cent target level despite global uncertainties and rising geopolitical tensions.

It added that globally, food prices are showing upside risks due to elevated energy costs, making domestic inflation trends vulnerable in the coming months.

"Thus, the pass through to domestic prices needs to be monitored closely, at a time when weather-related vagaries are posing upside risk to inflation in FY27," the...