Mumbai, June 22 -- The Reserve Bank of India (RBI) on Monday cautioned that any breakdown of the recent peace agreement in West Asia could rekindle significant risks for the global and domestic economy, including higher inflation, disruptions to energy supplies, weaker investment activity and slower economic growth.

In its June bulletin, the central bank said, "Any breakdown of the agreement may reignite material risks in terms of inflationary expectations, disrupted critical energy infrastructure, delayed investment spending, food security concerns, adverse financial stability outlook and structurally lower growth."

The central bank's assessment comes amid easing tensions following the interim peace agreement between the US and Iran, w...