India Inflation Weakest In 7 Months

RTTNews | 12घंटे 49 मिनट पहले

(RTTNews) - India's consumer price inflation slowed to a seven-month low in February as food price growth hit the lowest in nearly two years, raising expectations of interest rate cuts over coming months.

Consumer price inflation eased more-than-expected to 3.61 percent in February from 4.26 percent in January, official data revealed on Wednesday. This was the lowest since July 2024. Inflation was seen at 4.0 percent.

Food inflation softened to 3.75 percent from 5.97 percent a month ago. Food prices grew at the slowest pace since May 2023.

The larger-than-expected fall in headline inflation to below the Reserve Bank of India's 4 percent target supports the view that the bank will continue to loosen monetary policy over the coming months, Capital Economics economist Joe Maher said.

The economist expects another 75 basis point of interest rate cuts this cycle, bringing the repo rate down to 5.50 percent.

Earlier in February, the Reserve Bank of India had reduced its interest rate for the first time in nearly five years and to maintain a neutral policy stance. The repo rate was lowered by a quarter-point to 6.25 percent.

The Reserve Bank had projected consumer price inflation for 2024-25 at 4.8 percent and expected it to ease to 4.2 percent in 2025-26.

Another official data today showed that industrial production posted an annual growth of 5.0 percent in January after rising 3.2 percent in December. Economists had forecast output growth to improve moderately to 3.5 percent.

Within total production, manufacturing output growth advanced to 5.5 percent from 3.4 percent. Mining and electricity output grew 4.4 percent and 2.4 percent, respectively.

टैग: INR

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India Inflation Weakest In 7 Months