NEWS
Inflation at 4.45% in July, rise unlikely to induce rate hike
Food inflation rises to 5.52% in July from 5.32% in preceding month; retail inflation was 4.38% in June.
Food inflation rises to 5.52% in July from 5.32% in preceding month; retail inflation was 4.38% in June.
India’s retail inflation moved above the Reserve Bank of India’s medium-term target of 4% for the second consecutive month, but it is unlikely to induce the central bank to hike interest rates in its next policy.
The consumer price index climbed to 4.45% in July, largely driven by higher food prices, according to government data released on Wednesday.
In June, retail inflation was 4.38%.
Food inflation rose to 5.52% in July from 5.32% in the preceding month, on the back of weak monsoon showers. Ginger, garlic and onion prices rose sharply, offsetting declines in tomato prices.
The RBI had kept the short-term lending rate unchanged earlier this month, citing inflationary concerns.
"Going forward, we continue to expect inflation to rise above 5% from September onwards, keeping the case alive for RBI to turn towards (an) interest rate hike before the end of the year," said Sakshi Gupta, principal economist at HDFC Bank.
