Domestic inflation is likely to be higher in FY27 compared to FY26 but it is unlikely to be a concern, the Economic Survey 2025-26, tabled in Parliament on Thursday said. It has also projected headline inflation for Q1 and Q2 of FY27 at 3.9 per cent and 4 per cent, respectively. The International Monetary Fund (IMF) has projected an inflation rate of 2.8 per cent in FY26 and 4 per cent in FY27. “India’s inflation rate – headline and core excluding precious metals – will likely be higher in FY27 than in FY26. Story continues below this ad“The apparent divergence between headline and core inflation creates an impression of sticky core inflation, suggesting that underlying price pressures are firming even as headline inflation softens,” the Survey noted.