India’s consumer prices rose at a milder pace than anticipated in January and remained below the central bank’s target for a sixth straight month, strengthening views it could again cut the key interest rate at its next policy review in April.
Annual retail inflation in January rose 2.05 per cent, its slowest pace since June 2017, government data showed on Tuesday. The drope was due to a fall in food prices and smaller increases in fuel costs.
Figures released separately on Tuesday showed industrial output growth rose 2.4 per cent in December on the year.
In a surprise move on February 7, the Reserve Bank of India’s Monetary Policy Committee (MPC) cut the benchmark repo rate 25 basis points to 6.25 per cent, in its first cut in 18 months, and hinted of more room to cut rates.
Inflation pressures have eased in recent months, following falls in food and crude oil prices. India imports nearly 80 per cent of oil it consumes.
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