New Delhi, Aug. 29 -- India's inflation outlook will hinge critically on rainfall in September, with a further shortfall in the final month of the southwest monsoon potentially pushing FY27 consumer price inflation to 5.5 per cent or higher if El Nino conditions are confirmed, according to a Union Bank of India report.

The bank's research report said the monsoon remained 13 per cent below the long-period average as of Thursday, despite a recovery in kharif sowing.

It said September rainfall will be crucial for crop yields, soil moisture and water availability for the upcoming rabi season. "India's inflation outlook now hinges critically on the late-season monsoon performance," the report said.

Kharif sowing has recovered significantly ...