New Delhi, Oct. 4 -- Macro, financial markets and geopolitical conditions have witnessed a host of critical developments since the previous Reserve Bank of India (RBI) monetary policy committee (MPC) meeting in early August.

First, the prospects of a near-term resolution to the West Asia conflict, which had appeared plausible a couple of months back, have again faded. Brent crude prices have risen by about 23% since then, averaging over $95 per barrel and materially exceeding the RBI's oil price assumption of $90 per barrel for 2026-27. Globally, activity indicators have generally been resilient, while inflation staying elevated, if not inching higher.

Global meteorological organizations are also reporting that El Niño conditions a...