India's Retail Inflation Hits 10-Month Low at 4.83% in April

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Synopsis:

India's consumer price index (CPI) drops to 4.83% in April, below 5% for the second month. Rural inflation remains high at 5.43%. Food inflation rises to 8.70%. Analysts attribute the decline to easing prices of petroleum-related commodities.

India’s Inflation News Today

India's Consumer Price Index (CPI) dropped to a 10-month low of 4.83% in April, below the five-percent mark for the second consecutive month. This decline has continued since December 2023, remaining within the Reserve Bank of India's (RBI) tolerance range of 2-6%. Core inflation dropped to 3.2% in April, the lowest in the 2012 base CPI series.

Additional ReadRetail Sector in India

Urban vs. Rural Disparity

Urban CPI inflation decreased to 4.11% in April, while rural inflation remained elevated at 5.43%, attributed to a higher share of food products in rural consumption patterns.

Food Inflation on the Rise

Food inflation increased to 8.70% in April, with significant jumps in vegetable (27.8%), pulse (16.84%), and cereal (8.63%) prices compared to the previous year.

Factors Driving Inflation Trends

The decline in overall inflation can be attributed to easing prices of petroleum-related commodities like fuel and light, and transport and communication services. 

Additional Read: Share Market News

Analyst Perspectives

Experts note that the urban-rural disparity in inflation is primarily due to different consumption patterns. However, they also show concern over the high food inflation numbers despite the prevailing ban on cereal exports.

Outlook and Projections

If the current trend continues, CPI inflation in the April-June quarter may fall slightly below the RBI's projection of 4.9%, indicating a positive trajectory in inflation management.

Overall, while headline inflation approaches the MPC's 4% target, the persistently high food inflation remains a significant challenge for India's economy.

Sources:

https://www.deccanherald.com/business/economy/retail-inflation-declines-to-10-month-low-of-483-in-march-3020869

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