Business · Economy · 2 hrs ago
India’s retail inflation rises to 5.54% in September
India’s retail inflation rose to 5.54% in September, its highest level since January.
Higher food prices, including sharp increases in onion, ginger and garlic, helped drive the rise.
Inflation has been above the Reserve Bank of India’s 4% target for four months, though September’s rate remained within its 2%–6% tolerance band.
The central bank raised its policy rate by 0.25 percentage points last week, taking it to 5.5%, and increased its inflation forecast for the current fiscal year to 5.2%.
Economists expect inflation to approach 6% in the coming months, as uneven rainfall could affect crops and food supplies.
Some expect another 0.25-point rate increase at the next policy review.
India’s retail inflation rose to 5.54% year-on-year in September, its highest level since January.
Inflation stayed above the Reserve Bank of India’s 4% target for a fourth consecutive month.
Higher food prices were the main driver, with food inflation rising to 7.7% from 6% in August.
Economists expect inflation to approach 6% in the coming months and see the possibility of another policy rate increase.
Rural inflation reached 6.1%, while urban inflation rose to 4.9%.
- Who
- India’s statistics ministry reported the inflation data.
- What
- Retail inflation rose to 5.54% year-on-year in September.
- When
- September; the data was published on Monday.
- Where
- India.
- Why
- Higher food prices drove inflation. Uneven rainfall also threatened farm output.
This story does not have two clearly opposing sides.
Consumer inflation stood at 4.8%.
The RBI raised its current fiscal-year consumer inflation forecast to 5.2%.
Retail inflation reached 5.54%, while food inflation rose to 7.7%.
The statistics ministry published the September inflation data.
- Retail inflation
- 5.54% year-on-year in September
- RBI target
- 4%
- Food inflation
- 7.7% in September, up from 6% in August
- Rural inflation
- 6.1% in September
- Highest state or union territory inflation
- Tamil Nadu, 6.8%
- Largest listed food-price rise
- Onion, 108.1% year-on-year in September
What people are saying
another rate hike in December seems quite certain
Inflation in September rose on the back of higher food inflation, visible in rising onion prices as well as other food items like sugar, milk and cereals.
Sources
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