Retail inflation falls to 2.99% in April on lower food prices
The Dollar Business Bureau The country’s retail inflation declined sharply to 2.99% in April against the 3.89% in March, on account of lower prices of food items such as vegetables and pulses that recorded a deflationary trend. In April 2016, the consumer price index (CPI) inflation was at 5.47%. Pulses and products prices witnessed a sharp decline in April, with a deflation of 15.94%, whereas prices of vegetables fell by 8.59%. In March, the two items recorded a deflation of 12.42 and 7.24%. The fuel and light segment recorded an inflation of 6.13% in April, higher as compared to 5.56% in March. Fruit prices grew at 3.78% in April, lower than 9.35% in the previous month, according to the Ministry of Statistics and Programme Implementation ...
Retail inflation hits 23-month high at 6.1% in July
The Dollar Business Bureau Inflation based on Consumer Price Index (CPI) has escalated for the fourth month in a row to 6.1% in July, 2016 which is a 23-month high. This is mainly due to the growing food inflation at 8.4% while core inflation remained at 5.1% during last month. According to Crisil Research, an increase in CPI inflation is transitory. Normal monsoon and proactive steps taken by the government to manage food supply will rein in food inflation this fiscal. It will take one or two months for the benefit of the rains to wash away the rise in food prices. After the Reserve Bank kept its policy rate unchanged this month, Crisil expects a rate cut in October at least with more clarity ...
Falling inflation revives hope for interest rate cut by next month
The Dollar Business Bureau The Wholesale Price Index (WPI) for July released on Friday showed negative trend for the ninth month in a row, registering a fall of 4.05% mainly due to cheaper oil and other commodities. According to the latest government data, WPI stood at -4.05% for the month of July, 2015 as compared to -2.40% for the previous month and 5.41% during the corresponding month of the previous year. The Consumer Price Index (CPI) released on Wednesday also saw a decline of 3.78% last month. Apart from the inflation data, the Index of Industrial Production (IIP) which measures the manufacturing output has also recorded growth of 3.8% during June. These figures are key indicators of the economy and form the ...
Industry bodies urge RBI to cut policy rate
The Dollar Business Bureau The Governor, Reserve Bank of India, Dr. Raghuram Rajan delivering the Annual Day Lecture on “Banking Structure in India: Possibilities and Challenges”, on the occasion of the Annual Day of Competition Commission of India, in New Delhi on May 20, 2014. Source: PIB, Government of India Ahead of the Reserve Bank of India's (RBI) bi-monthly monetary policy review, industry bodies like FICCI and Assocham expect RBI to cut policy rate as inflation is hovering at levels, much below foreseen by the central bank itself and the industry needs a demand trigger for a revival. Dr. Jyotsna Suri, President, FICCI feels reduction in lending rates by financial institutions is the need of the hour, which has also ...
Gradual economic recovery to be led by consumption demand
The Dollar Business Bureau The gross domestic product (GDP) for the financial year (FY) 2016, will grow by 7.7% (FY15: 7.4%), driven by a further pick up in private consumption demand. Consumption demand is expected to expand 8.1% in FY16 (FY15: 7.1% and FY14: 6.2%), said a rating agency. A significant moderation in inflation and inflationary expectations is likely to boost consumer sentiments, albeit gradually. The share of private consumption demand in GDP is around 60%. Even investment and government expenditure would provide adequate support to consumption-led GDP growth, said a report by India Ratings and Research (Ind-Ra). There are conflicting views with respect to the monsoon in 2015 as Indian Meteorological Department is predicting less-than-normal monsoon and private ...
Manufacturing inflation declines further in March 2015
The Dollar Business Bureau The annual rate of inflation came in at negative 2.3% in March 2015, based on Wholesale Price Index (WPI) and a benign manufacturing inflation declined further and turned negative 0.2% in March 2015 from 0.3% in February 2015. This is the fifth consecutive month in which WPI has recorded deflation. Among the major components of WPI, primary articles and manufactured products recorded a monthly decline in inflation. Although fuel & power did not decline monthly, it is still showing a huge YoY decline (negative 12.6%) due to the collapse of commodity prices especially of oil in the global market, said an India Research & Ratings (Ind-Ra) report. The average WPI and Consumer Price Index (CPI) ...
South Asia minus India yet to cash in oil price fall dividend - World Bank
The Dollar Business Bureau A World Bank report notes that India has already taken encouraging steps to decouple international oil prices from fiscal deficits and to introduce carbon taxation to address the negative externalities from the use of fossil fuels. The challenge will be to stay the course in the event of oil price hikes – something that may well happen in the medium term. However, “The biggest oil price dividend to be cashed in by South Asia is one yet to be earned, but it is not one that will automatically transit through government or consumer accounts” said World Bank South Asia Chief Economist Martin Rama. “Cheap oil gives the opportunity to rationalize energy prices, reducing the fiscal ...
