The inflation data for the month of August is out. The consumer price index (CPI) fell sharply to 5.05% year-on-year from 6.07% in July, thanks largely to a sharp fall in food prices, which enjoy about 50% weight in the inflation basket used for CPI calculations. Food inflation has slowed to 5.91% from 8.35% .
Also, Industrial output data
showed that July index of industrial production (IIP) came in at -2.4 percent,
compared to 1.95 percent (revised) in June.
The Reserve Bank of India( RBI) is going ahead with the inflation targeting of to bring down CPI to below 5% by January 2017. This target seems achievable, due to the falling food prices and the base effect. The weakness in the Industrial output however is being largely associated with weak demand for Capital goods globally.
These two data coupled with Urjit Patel taking over the reins of RBI has increased the hope of a Rate Cut by RBI. The interest rates were last revised in April. Since then many people have been vying for the rates to be cut down. Raghuram Rajan, former RBI Governor, specifically stated that there was no room for rate cuts as inflation has to be reined in.
Now that inflation seems to be under control and there is a need to revive the industrial output, chances seem high that RBI may cut Rates in its next monetary policy meet.
August consumer price
index (CPI) fell sharply to 5.05 percent year-on-year from 6.07 percent
in July, thanks a sharp fall in food prices, which enjoy about 50
percent weight in the inflation basket, government data released today
showed.
Read more at: http://www.moneycontrol.com/news/economy/august-cpi-falls-to-505-july-iip-contracts-by-24_7444961.html?utm_source=ref_article
Read more at: http://www.moneycontrol.com/news/economy/august-cpi-falls-to-505-july-iip-contracts-by-24_7444961.html?utm_source=ref_article
consumer price index
(CPI) fell sharply to 5.05 percent year-on-year from 6.07 percent in
July, thanks a sharp fall in food prices, which enjoy about 50 percent
weight in the inflation basket, government data released today showed.
Read more at: http://www.moneycontrol.com/news/economy/august-cpi-falls-to-505-july-iip-contracts-by-24_7444961.html?utm_source=ref_article
Read more at: http://www.moneycontrol.com/news/economy/august-cpi-falls-to-505-july-iip-contracts-by-24_7444961.html?utm_source=ref_article
consumer price index
(CPI) fell sharply to 5.05 percent year-on-year from 6.07 percent in
July, thanks a sharp fall in food prices, which enjoy about 50 percent
weight in the inflation basket, government data released today showed.
Read more at: http://www.moneycontrol.com/news/economy/august-cpi-falls-to-505-july-iip-contracts-by-24_7444961.html?utm_source=ref_article
Read more at: http://www.moneycontrol.com/news/economy/august-cpi-falls-to-505-july-iip-contracts-by-24_7444961.html?utm_source=ref_article
