News Brief

Retail Inflation In India Expected To Stay Below 5 Per Cent As Monsoon Progresses Satisfactorily: SBI Research Report

Swarajya StaffJul 14, 2024, 03:51 PM | Updated 03:51 PM IST
SBI Logo. 

SBI Logo. 


Retail inflation in India, is projected to remain below or close to 5 per cent for most of the remaining months of 2024-25, except for September, according to a report from The Economic Times.

"With the monsoon progressing satisfactorily and overall seasonal variations balancing out, we do not expect any significant deviation in the inflation outlook," stated a report from SBI Research authored by Soumya Kanti Ghosh, Group Chief Economic Adviser at the State Bank of India.

India's retail inflation or the Consumer Price Index (CPI) rate rose in June, reversing the previous trend of moderation, due to increasing food prices.

The year-on-year inflation rate is based on the pan India CPI provisionally recorded at 5.08 per cent for June 2024. The corresponding rates for rural and urban areas were 5.66 percent and 4.39 per cent, respectively.


Moreover, with US inflation declining by 0.1 per cent from May, bringing the 12-month rate to 3 percent, its lowest level in over three years, there are indications of a potential Federal Reserve rate cut by September, the report noted.

"We, therefore, feel the RBI will revisit the policy stance around that time in line with our expectations," the SBI Research report added.

However, rising food prices remain a concern for Indian consumers, with food inflation nearly doubling year-on-year in June. Food inflation surged to 8.36 per cent last month, compared to 4.63 per cent in the same month of 2023, according to the same report.

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