New Delhi, June 19 -- The RBI Governor Sanjay Malhotra said that the Monetary Policy Committee (MPC) will have to be watchful of the inflation trajectory going forward, especially in the light of the revision of fuel prices in May.

"We need to be watchful of the inflation trajectory. Going forward, revision in retail prices of petrol and diesel in May would lead to higher fuel inflation in the coming months," the Governor said in the minutes of the Monetary Policy Committee meeting.

The Governor said that even though the near-term outlook for food prices remains favourable, the risks from a poor monsoon due to El Nino have increased.

The Monetary Policy Committee, in its policy announcement on June 5, maintained the status quo and kept...