Published: Mon, November 13, 2017
World | By Paul Elliott

India October Consumer Price Inflation at 7-Month High

Food and fuel prices pushed India's annual retail inflation rate higher in October, official data showed on Monday.

India's retail inflation grew at 3.58 percent in October, mainly due an increase in prices of consumer food items.

"Today's reading has reaffirmed our position that the inflation trajectory in the second half of this year could be lower than the RBI's projected path of 4.2 percent to 4.6 percent".

Measured by the Consumer Price Index of CPI, retail inflation rose by 3.28% in September. The rate of price rise in the vegetable segment nearly doubled to 7.47 per cent as against 3.92 per cent in September.

Higher inflation was also noted in protein rich items like eggs and milk (and its products). However, fruits were comparably cheaper in October on sequential basis. Similarly, prices of pulses fell -23 percent, as compared with (-) 22.51 percent in September. However, there is a risk that a surge in crude oil prices and recent softness in the Indian rupee might affect the imported inflation component.

Aditi Nayar Principal Economist at ICRA said "The staggered impact on the housing index of the CPI, of the revision in HRA of central government employees, is likely to push up housing inflation further over the coming year".

All eyes will be on the current fiscal's sixth bi-monthly meeting of the Monetary Policy Committee, headed by RBI Governor Urjit Patel, on December 5-6.

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