One of the main reasons why inflation has spiked over the past year is related to the pound’s 15 percent or so drop fall since the country voted to leave the European Union in June 2016.
Preliminary data released by the Central Statistics Office on Thursday showed India’s consumer price inflation numbers to have remained steady in September while industrial production rose favourably.
On the back of a waning impact of the GST accompanied by increased commodity prices, the index of industrial production (IIP), wholesale price index and consumer price index are expected to increase.
If the September number matches the poll consensus, inflation would be the highest in six months – yet still below the Reserve Bank of India’s mid-term target of 4 percent.
Guwahati people also had the highest one-year ahead expectations of 15.3 per cent, followed by Bhubaneswar at 12.5 per cent. Mumbai residents project it at 7.8 per cent. The most optimistic were Bengaluru residents at 5.5 per cent.
According to a SBI report, the RBI is likely to maintain status quo on key lending rate in Wednesday’s policy review as it is “stuck in a conundrum” of low growth, mild inflation and global uncertainties.
“Today, the government is taking decisions without taking anybody into confidence. Modi should go through the speeches he delivered before becoming the PM, when the fuel prices went up during the Congress rule,” said Shiv Sena’s Lok Sabha member Arvind Sawant.
Vegetable prices shot up by 44.91 per cent in August, as against 21.95 per cent in July. Onion prices witnessed a sharp surge at 88.46 per cent in August, as against a contraction of 9.50 per cent in the previous month.
India’s retail inflation in August jumped to a five-month high of 3.36 percent from a year ago, driven by higher food prices, government data showed on Tuesday.
An upward revision of house rent allowance (HRA) for Central government staff and higher GST on services in the first month of its launch may have weighed on retail inflation a bit, said analysts, although the impact hasn’t been very significant yet.
Average CPI inflation for eight months since September 2016 has been 3.7 per cent. How long are you going to wait and watch, MPC, before you admit that you were wrong in your assessment?
The main price increases last quarter were in health care, taxes on tobacco and the cost of buying a house, offsetting that were falls in holiday travel, petrol and fruit, according to data from the Australian Bureau of Statistics.
Nomura believes CPI to have “troughed” in June and we expect it to rise gradually by end-2017, as deflation in food wanes, base effects turn adverse and higher house rent allowances for central government employees raises housing inflation from July.
The retail inflation on Wednesday hit a new low of 1.54 per cent in June, down from 2.18 per cent in May, helped by a fall in food prices, according to official data.
GST will help bring down the inflation by one to two per cent by the end of this year, Revenue Secretary Hasmukh Adhia has been quoted, as saying. Adhia told in an interview that the government’s objective is to ensure that inflation does not increase.