CPI Inflation Marginally Higher In October; Industrial Production Growth Below Expectations: Motilal Oswal
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Motilal Oswal Report
Consumer price index-based retail inflation came in moderately higher at 4.48% YoY in October 2021 (versus 4.35% YoY in September 2021).
The number is in line with our expectations as well as the Bloomberg consensus. Food inflation came in at 0.9% YoY in Oct-21, after 2.5-year-low food inflation at 0.7% YoY in Sep-21.
The items driving this marginal increase were 'cereals and products,' 'fruits,' 'milk and products,' and 'sugar confectionary'.
These items constitute more than 20% weight in the food basket. Notably, ‘fuel and light’ inflation continued rising and came in at 14.3 % YoY in Oct-21 (versus 13.6% YoY in Sep-21).
Separately, index of industrial production growth stood at 3.1% YoY in Sep-21 (versus 12% YoY in Aug-21).
The number is lower than our expectation of 4.4% and the Bloomberg consensus of 4.8% YoY. Notably, IIP growth for June/August 2021 has been revised upwards to 13.8%/12% YoY (from 13.6%/11.9% YoY).
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