Retail inflation in India eased to 5.10% in January, down from 5.69% in December. Inflation rates in rural and urban areas also decreased. While the retail inflation is within the RBI s comfort level, it remains above the ideal 4% scenario. Analysts believe that the RBI may hold interest rates steady until at least the June policy review, but if the trajectory persists, rate cuts may be implemented. The arrival of early harvest and a favorable base effect are expected to alleviate price pressures.
Retail inflation in India eased to 5.10% in January, down from 5.69% in December. Inflation rates in rural and urban areas also decreased. While the retail inflation is within the RBI s comfort level, it remains above the ideal 4% scenario. Analysts believe that the RBI may hold interest rates steady until at least the June policy review, but if the trajectory persists, rate cuts may be implemented. The arrival of early harvest and a favorable base effect are expected to alleviate price pressures.
If one sees the Indian economy in the context of the global economy, 2023 has the makings of the year when India started its ascent towards becoming a developed country. But any close inquiry of India’s achievements reveals a far more complex picture.
Two recent reports about India s economy show its strength but also warn about challenges ahead. The International Monetary Fund (IMF) praised India s growth and financial progress. The Reserve Bank of India (RBI) highlighted good growth but cautioned about inflation and potential risks to future progress.
India s wholesale inflation persisted in negative territory for a seventh consecutive month, contracting 0.52% in October, faster than September s 0.26% fall. The rate of decline in fuel prices slowed, dropping by 2.47% compared to the previous month s 3.5% fall.