The central bank noted that headline inflation had "edged up above target as expected," but core inflation, excluding precious metals, continues to "remain moderate." Core Inflation is expected to decline after peaking in the December quarter, Sanjay Malhotra, RBI governor, said in his address on Wednesday. Future rate action would also have to "consider the need for recalibration of policy rates in line with the evolving growth-inflation dynamics," Malhotra said. The Indian central bank, however, has repeatedly emphasized that its focus is on core inflation — which excludes energy and food prices. But a prolonged rise in energy prices could lift core inflation as well through higher input, transportation, and operational costs.