India’s inflation accelerated as central bank Governor Raghuram Rajan looks to maintain an accommodative monetary policy stance.
Consumer prices rose 4.41 percent in September from a year earlier after a revised 3.74 percent increase in August, the Statistics Ministry said in a statement in New Delhi on Monday. The median of 40 estimates in a Bloomberg survey of economists had predicted a 4.40 percent gain.
"Inflation bottoming is almost all done and we will see it picking up slightly but it will not accelerate alarmingly," Vishnu Varathan, a Singapore-based economist at Mizuho Bank Ltd., said before the data. "Room for lowering rates will be become a lot more limited."
Rajan in September lowered the benchmark repurchase rate by half a percentage point to 6.75 percent -- the biggest reduction since 2009 -- after months of rebuffing government calls for a cut. He said the Reserve Bank of India will probably meet its 6 percent CPI target for January and is now focusing on its 5 percent goal for March 2017.
The benchmark equity index lost 0.7 percent in Mumbai on Monday before the data and the yield on the 10-year sovereign bond rose four basis points to 7.58 percent. The rupee was little changed at 64.7525 a dollar.
In a separate release, industrial production grew 6.4 percent in August compared with an estimated 4.8 percent increase.
Inflation Highlights:
* India’s Food Price Index rose 3.88 percent in September from a year earlier after a 2.2 percent increase in August
* Rise was led by a 30 percent surge in lentil costs even as vegetable prices were steady. The government is importing more pulses and vegetables to offset the impact of the driest monsoon in six years
* Food accounts for almost half of the CPI basket
source: Bloomberg
No comments:
Post a Comment