India Retail Inflation Quickens Ahead of RBI Rate Decision
India’s Retail Inflation Quickens Raising Possibility Of Policy Tightening
(Bloomberg) -- India’s retail inflation in April accelerated more than estimated, raising the possibility the central bank may tighten policy next month.
Key Points
- Consumer prices climbed 4.58 percent in April from a year earlier, the statistics ministry said in a statement in New Delhi on Monday
- That compares with the 4.40 percent median estimate in a Bloomberg survey of 41 economists and March’s 4.28 percent pace
- Food price index rose 2.8 percent after previous month’s 2.81 percent rise
- Wholesale prices rose 3.18 percent in April, the commerce ministry said earlier in the day, faster than the 2.9 percent forecast in a separate survey
Big Picture
The continuing surge in prices of crude oil, India’s biggest import, could add to the Reserve Bank of India’s concerns about keeping inflation in check. The central bank could turn hawkish as elevated fuel prices along with a weaker rupee may widen the trade deficit and squeeze government finances.
The central bank’s Monetary Policy Committee, which stood pat at the last meeting, is due to review policy rates on June 5 and 6.
The Details
- Food and beverage prices rose 3 percent, led by a jump in fruits and vegetables prices
- Clothing and footwear rose 5.1 percent
- Fuel and lighting rose 5.24 percent
- Housing rose 8.5 percent
--With assistance from Manish Modi
To contact the reporter on this story: Archana Chaudhary in New Delhi at achaudhary2@bloomberg.net.
To contact the editors responsible for this story: Ruth Pollard at rpollard2@bloomberg.net, Nasreen Seria at nseria@bloomberg.net, Karthikeyan Sundaram
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