Posted at 4:40 PM , on February 17, 2020
CPI Inflation for the month of Jan-20 came in at a 68-month high of 7.59%. This was largely driven by food inflation but core inflation has also chipped in with its own contribution. That could be something for the RBI to be cautious.
Double whammy on inflation
If you look at the inflation number for Jan-20, then it is up to the highest level in nearly 6 years. This is despite the fact that food inflation has come down marginally compared to December. Then why is CPI inflation higher? Firstly, fuel inflation has inched up during the month of January. Secondly, the core inflation (non-oil and non-food) has also inched up during the month of Jan-20. In the last few months, it was only food inflation but now core inflation is also proving to be a worry for the RBI. That could be the double whammy!
Posted at 11:20 AM , on February 14, 2017
The Monetary Policy announced by the RBI on 08th February was largely along expected lines. One needs to understand the context in which the policy was announced. On the one hand, the Indian economy is just about emerging from the cash shortfall caused by the demonetization. On the other hand, inflation continues to stay under control and IIP and core sector are showing green-shoots of recovery. The global scenario is the bigger question mark. BREXIT is raising serious questions over the sustainability of the common currency model while the UK still does not have clarity on its trade strategy post BREXIT. Above all, the US is increasingly making protectionist noises even as Indian companies are already under pressure due to recent measures like H1-B visa restrictions, immigration checks and a likely border tax on outsourcing. It is in this highly charged atmosphere that the Monetary Policy was announced by the RBI… Continue reading
Posted at 6:20 PM , on November 25, 2016
Has India finally tamed the inflation demon?
The CPI and WPI numbers that came in during the week were a whiff of fresh air. CPI inflation at 4.20% is now already well below the RBI comfort level of 5%. The WPI inflation at 3.30% is also showing signs of tapering. There are broadly 4 issues to understand… Continue reading