RBI Flags Inflation Spillover Risks From Middle East Conflict

India’s central bank governor said the Middle East crisis could fuel persistent inflation if supply disruptions endure, given the country’s deep economic links to the region.

“Second-round effects are the real concern,” Governor Sanjay Malhotra said in a speech at Princeton University, his alma mater, on Saturday. A copy of the speech was uploaded on the Reserve Bank of India website Monday. Such effects refer to initial price shocks feeding into broader, more sustained inflation.