A severe El Niño event could be the harbinger of weak monsoon rains in India. This wouldn’t have as big an economic impact as it would have had a couple of decades ago. But it would harm employment and energy production. What’s more, it would push up prices of key crops including rice, adding upward pressure to overall food inflation. That could delay the start of the easing cycle and may even force the RBI to tighten policy further in the near term.
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