Mumbai, April 8 -- Reserve Bank of India (RBI) Governor Sanjay Malhotra has stated in today's monetary policy document that domestic private consumption in 2026-27 is expected to be supported by discretionary spending. Rural demand remains robust. It should gain further traction on the back of favourable agricultural conditions and a healthy labour market. Urban consumption is likely to strengthen further, aided by the beneficial impact of GST rationalisation and buoyant services sector activity.

While the government's thrust on infrastructure spending continues, the revival in private sector investment is expected to sustain on the back of high-capacity utilisation, strong credit growth and benign financial conditions. On the external f...