Published: Fri, February 14, 2020
Markets | By Otis Pena

India's retail inflation rises to 7.59 percent in January

India's retail inflation rises to 7.59 percent in January

The index for "Minerals" group declined by 7.2 percent to 142.6 (provisional) from 153.6 (provisional) for the previous month due to lower price of manganese ore (20%), copper concentrate (12%), iron ore (5%).

According to Subramanian's assessment, core inflation (headline retail inflation minus food and fuel) stood at 4.2 per cent.

India's wholesale inflation accelerated to 3.1% in January, driven up by fuel and power, and manufactured products, data released by the commerce and industry ministry showed on Friday.

The Fed previous year cut its benchmark interest rate three times to the current historically low range of 1.5% to 1.75%.

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The Reserve Bank of India (RBI) tracks consumer inflation primarily for formulating its monetary policy. 4% was the target for the period from August 5, 2016 to March 31, 2021, with an upper tolerance limit of 6% and the lower tolerance limit of 2%.

Powell told a House Financial Services Committee hearing February 11 that while the economy grew at a moderate pace and the labor market strengthened over the second half of past year, inflation remained below the Federal Open Market Committee's (FOMC) symmetric 2 percent objective. In January, the core CPI rose by a seasonally unadjusted 2.3 percent year-over-year, rising by the same margin for four straight months. However, it is down from 14.19% in December. The last reading of 7.35% in December 2019 prompted the central bank to vote not to cut rates last week.

The country's industrial output also contracted by 0.3% in December, weighed by a decline in the manufacturing sector, government data showed on Wednesday.

A surge in onion prices contributed around 70 basis points to retail inflation that scaled a 68-month peak of 7.59 per cent in January, Chief Economic Adviser Krishnamurthy Subramanian said Thursday, stressing that the latest spike in inflation is "transitory" and is substantially driven by volatile vegetable prices and an unfavourable base. The similar hike in WPI was earlier recorded at 3.24 percent in April 2019. Before that, it touched 3.46 per cent in December 2018.

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