The Reserve Bank of India’s (RBI) policy response to the ongoing energy price shock is likely to be challenging due to multiple trade-offs involving inflation, growth, liquidity and currency stability, according to a report by Emkay Research.

The report highlighted that there is no straightforward policy approach to deal with an energy-driven shock, especially when inflation remains relatively benign but risks are rising due to second-round effects. It stated “RBI’s battle unlikely to be easy, FX and rates trade-offs.” It noted that before the conflict, the RBI’s focus was on improving monetary policy transmission, particularly in the bond market, supported by ample liquidity that kept overnight rates below the policy rate.

However, the current situation has become more complex as rising oil prices are now influencing inflation expectations, growth outlook and financial conditions. While direct pass-through of oil prices remains limited due to managed fuel pricing, indirect effects are becoming more significant.

The report said that the central bank faces a difficult choice between supporting growth and controlling inflation, while also managing currency pressures.The bar for a conventional rate hike remains high given that the shock is supply-driven, but at the same time, the RBI may need to reassess its liquidity stance.It added that the Indian rupee continues to remain under pressure despite consistent foreign exchange interventions, largely through forward markets.

While these interventions have helped stabilise the currency, they have also delayed liquidity tightening. At the same time, the RBI has been supporting bond markets through purchases, keeping yields in check. However, the report noted that a sharp policy response in the form of raising interest rates to defend the currency appears unlikely at this stage.

The report also highlighted that prolonged disruptions in energy supply due to the Iran conflict could significantly impact India’s macroeconomic outlook. It revised its baseline forecast for FY27, assuming an average Brent crude price of $80 per barrel, with higher pressure expected in the first quarter.As a result, GDP growth for FY27 has been trimmed by 0.4 percentage points to 6.6 per cent, while inflation has been revised upward to 4.3 per cent.

The current account deficit (CAD) is also expected to widen to 1.7 per cent of GDP. It added that the final impact on growth, inflation and fiscal position will depend on how the burden of higher oil prices is shared among oil marketing companies, the government and consumers. So the report outlined that the RBI’s policy path will remain complex amid rising external risks, currency pressures and the need to balance growth and inflation concerns.

Published on March 24, 2026

India’s imports of iron ore, a key raw material in steelmaking, ​are set to rise to a
seven-year high in the ⁠fiscal year ending on March 31, driven by
a shortage of high-grade ore and demand from JSW Steel
, analysts and industry executives said.

Overall imports are likely ‌to reach 12 million to 14 million
metric tons in 2025-26, more than doubling from a year earlier,
analysts and trade ‌officials said.

JSW Steel, India’s biggest steelmaker by capacity, was a ‌key
driver ⁠of iron ore imports for its mills in the ⁠western state of
Maharashtra and the southern state of Karnataka, said Lalit
Ladkat, a senior analyst at London-basedconsultancy CRU.

A cargo of BHP’s Jimblebar Fines iron ore is
heading to India ​in a rare sale, driven ‌by discounts on the
product that was banned for sale in China, Reuters reported last
week.

The bulk of India’s iron ore imports in the fiscal year
originated from Brazil and Oman, which together accounted for
about ‌70% of total shipments, Ladkat said.

Iron ore output in ​India, the world’s second-largest crude
steel producer, is expected to reach 305 million tons in the
2025–26 fiscal year, up from ⁠289 million metric tons a year
earlier, according to commodities consultancy BigMint.

But exports of iron ore are expected to reach 29 million
metric tons, up ‌26% from a year earlier, with 85% of shipments
going to China, Ladkat said.

India mainly exports low-grade iron ore that is generally
not used by steel mills in the country, mining officials said.

In the fiscal year that begins on April 1, India’s iron ore
output is expected to rise as mines ramp up production, although
imports may continue depending ‌on grade requirements and
plant-level supply dynamics, said Sumit Jhunjhunwala, vice
president at ICRA Ratings.

IRON ​ORE PELLET IMPORTS SET TO DROP

India, which has been importing cheaper iron ore pellets –
processed or value-added products – from ⁠Iran since last year,
is likely to see volumes decline due to the ⁠conflict in the
Middle East, analysts said.

“Indian pellet imports from Iran could decline amid
heightened geopolitical tensions and associated trade
uncertainties, while ample ‌domestic pellet availability is
likely to constrain import demand,” BigMint said.

From April to February, India imported 1.88 million metric
tons of iron ore ​pellets, up six times from a year earlier.

Published on March 24, 2026

Equity benchmarks extended their morning gains into the afternoon session on Tuesday, with the BSE Sensex and Nifty 50 holding firm above key levels around midday, driven by a sharp pullback in crude oil prices after US President Donald Trump postponed strikes on Iran’s power infrastructure.

At 12:55 pm, the Sensex was trading at 74,295.40, up 1,599.01 points or 2.20 per cent. The Nifty 50 stood at 23,012.00, up 499.35 points or 2.22 per cent as of 12.54 pm. The indices had opened gap-up in the morning — Sensex at 74,212.47 against a previous close of 72,696.39, and Nifty at 22,878.45 against a previous close of 22,512.65 — and have built on those gains through the session.

The trigger was Trump’s announcement of a five-day halt to planned strikes on Iranian energy infrastructure, citing “productive conversations.” Brent crude fell around 11 per cent, retreating from above $112 to below $105. US markets had closed higher overnight, with the S&P 500 gaining 1.4 per cent and the CBOE VIX easing 5.9 per cent to 25.2, providing a supportive global backdrop.

On the Nifty 50, IndiGo led the gainers, rising 5.25 per cent to ₹4,152.40 from a previous close of ₹3,945.30. Shriram Finance gained 5.22 per cent to ₹923.50 from ₹877.70. Eternal advanced 5.09 per cent to ₹238.51 against its previous close of ₹226.96. Larsen & Toubro climbed 4.63 per cent to ₹3,497.00 from ₹3,342.40, while UltraTech Cement rose 4.30 per cent to ₹10,808.00 from ₹10,362.00.

The sectoral spread of the gains — aviation, financial services, quick commerce, infrastructure, and cement — points to a broad-based recovery rather than a narrow crude-driven bounce. The breadth data on BSE reinforced this: of 4,252 stocks traded, 3,016 advanced against 1,056 declines, with 180 unchanged. As many as 440 stocks hit 52-week lows, however, while 39 reached 52-week highs, reflecting that Monday’s damage has not been fully reversed across the broader market. Stocks in upper circuit numbered 96, against 161 in lower circuit.

On the losing side, Coal India slipped 2.39 per cent to ₹444.35 from its previous close of ₹455.25, while Power Grid Corporation fell 0.86 per cent to ₹299.50 from ₹302.10. The decline in Coal India comes even as the broader market rallied, with analysts flagging the stock’s sensitivity to energy policy shifts. Power Grid has now declined in both sessions this week.

Oil marketing companies remained in focus through the session, with the fall in crude improving their refining margin outlook. InvestorAi’s morning note flagged BPCL and Hindustan Petroleum as its highest-conviction calls of the day, noting that downstream oil marketing names offer “pricing resilience that pure upstream names lack.” Power infrastructure name Tata Power, life insurer Max Financial, and industrials player Supreme Industries were also flagged as conviction picks, pointing to a broadening of the relief rally beyond direct oil beneficiaries.

India VIX, which had spiked to 26.73 on Monday — up 17.17 per cent — remained elevated, keeping traders cautious about the durability of the move. With the weekly Nifty F&O expiry falling today, accelerated time decay and volatility-driven swings remain a risk through the afternoon session. Trump’s five-day window on Iran closes by Saturday, and any breakdown in diplomatic momentum could push crude back above $115 and test Monday’s low of 22,512 on the Nifty once more.

Published on March 24, 2026