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<ul><li><keyword id="67286" type="General" weightage="20" keywordseo="food-inflation" source="Orion">Food inflation</keyword> lowered to 9.94% in August as compared to 11.51% in July.</li><li>Softer <keyword id="6408856" type="General" weightage="20" keywordseo="vegetable-prices" source="Orion">vegetable prices</keyword>, slide in prices of meat and egg products and fish aided the food inflation print.</li><li>Prices of cereals, milk, fruits and spices rose significantly in August as compared to July.</li><li>India’s factory output or IIP increased by 5.7% in July, according to the official data. </li></ul><keyword id="513422" type="General" weightage="20" keywordseo="retail-inflation" source="Orion">Retail inflation</keyword> declined to 6.83% in August compared to 7.44% July, mostly due to easing vegetable prices. This year’s August print also came in lower than 7% seen in the same month last year. Core inflation stood at 4.9% for the month, eased marginally from the month before, and it’s the third consecutive month of a dip in inflation of this metric. Food inflation lowered to 9.94% in August as compared to 11.51% in July. Apart from softer vegetable prices, slide in prices of meat and egg products and fish also aided lower food inflation print. 'A modicum of relief' Economists call this easing a ‘modicum of relief’. “The consumer price inflation (CPI) inflation eased below the 7% mark in August 2023 to a lower-than-expected 6.8%, largely led by vegetables, amidst some moderation in the prints for clothing and footwear, housing and miscellaneous items as well,” said Aditi Nayar, chief economist at rating agency ICRA. The prices of cereals, milk and fruits as well as clothing and footwear and spices rose significantly in August as compared to July. Cereals and pulses inflation are seeing an uptick and this trend could be more sticky, says Suvodeep Rakshit, senior economist at Kotak Institutional Equities. The numbers are in line with the expectations of most economists, they also flagged off concerns of other factors that might keep inflation higher in the coming months. “The recent measure to lower LPG prices will have a 0.2-0.25% impact on inflation in September. While inflation for September will move towards the 6% mark and probably go lower, this will not be very comforting yet for monetary policy,” said Madan Sabnavis, chief economist at Bank of Baroda. Even if the CPI inflation print is in the range of 5.3-5.5% in September 2023, it will average to a 6.6% for the second quarter of FY24 – that’s well above RBI’s forecast in August. The Reserve Bank of India (RBI) has projected the CPI inflation at 5.4% for 2023-24. “We expect the MPC to remain on hold in October 2023, while continuing to demonstrate caution amid a cloudy outlook for food inflation and elevated crude oil prices,” said Nayar. IIP hits a 5-month high India's industrial production (IIP) increased by 5.7% in July to hit a five month high, as per data released on Tuesday. Factory output measured in terms of IIP grew by 2.2% in July 2022. The data released by the National Statistical Office (NSO) showed that the manufacturing sector's output increased by 4.6% in July 2023. Mining output rose 10.7% during the month under review. Power output grew 8%. The IIP grew by 4.8% in April-July 2023 compared to 10% in the same period of 2022. The industrial growth number is however comforting for RBI in terms of giving reassurance on the growth front even as nine of the manufacturing industries have witnessed negative growth,” said Sabnavis. He opines that the months of September, October and November will hold clues to the sustenance of growth in industry and will be dependent on consumer goods reviving. (With PTI and IANS inputs)

Retail inflation declines to 6.83% in August on falling food prices; July IIP at 5.7%

<ul><li>Retail inflation eased to a three-month in January mainly on account of lower food prices.</li><li>Twelve of the 22 states witnessed higher than average inflation, especially in large states like Maharashtra, UP, Gujarat, Karnataka.</li><li><keyword id="19895063" type="General" weightage="20" keywordseo="india" source="keywords">India</keyword>'s industrial production grew 3.8% in December 2023, according to official data. </li></ul>Retail inflation eased to a three-month low of 5.1% in January mainly on account of lower food prices, according to official data released on Monday. Inflation based on the Consumer Price Index (CPI) was at 5.69% in December 2023 and 6.52% in January 2024. In August 2023, inflation touched a high of 6.83%. According to the data released by the <keyword id="20070866" type="General" weightage="20" keywordseo="national-statistical-office" source="keywords">National Statistical Office</keyword> (<keyword id="20067517" type="General" weightage="20" keywordseo="nso" source="keywords">NSO</keyword>), retail inflation in the food basket was at 8.3% in January 2024, down from 9.53% in the preceding month. “Inflation came in higher for December than our expectations at 5.1% against 4.7%, though lower than that of November which was 5.7%. Food products continue to exert upward pressure on inflation with cereals, vegetables, fruits, pulses, sugar and spices all witnessing high increases. There has been soothing of inflation in the core goods and services which is a relief from the point of view of monetary policy,” said <keyword id="20102121" type="General" weightage="20" keywordseo="madan-sabnavis" source="keywords">Madan Sabnavis</keyword>, chief economist at Bank of Baroda. Twelve of the 22 states witnessed higher than average inflation. It indicates that inflation is still high in large states like Maharashtra, UP, Gujarat, Karnataka, opine experts. The <keyword id="19899810" type="General" weightage="20" keywordseo="reserve-bank-of-india" source="keywords">Reserve Bank of India</keyword> has been tasked by the government to ensure retail inflation remains at 4%. “With RBI stating risk of food inflation translating into generalised inflation, we expect RBI to continue cautious stance. However, softening of core inflation should provide confidence to trajectory of inflation moving as expected. We think RBI would rather continue with stability priority and continue maintaining 4% inflation target as sacrosanct, and hence we do not see premature easing from RBI,” said Akhil Mittal, senior fund manager-fixed income, Tata Mutual Fund. Most experts believe that uncertain food prices will keep the central bank cautious. "CPI inflation came in slightly softer than our expectations led by moderation in food prices. Positively though, core inflation softened in line with our expectations. However, uncertainties in food inflation outlook should keep RBI cautious in the near term, with much of action by the RBI expected on the liquidity front," said Upasna Bhardwaj, chief economist, Kotak Mahindra Bank. Industrial production grows 3.8% in December 2023 India's industrial production grew 3.8% in December 2023, according to official data released on Monday. Factory output measured in terms of the Index of Industrial Production (IIP) had witnessed a growth of 5.1 per cent in December 2022. "India's Index of Industrial Production grows by 3.8% in December 2023," an official statement said. The data released by the National Statistical Office (NSO) showed that the manufacturing sector's output grew 3.9% in December 2023, up from 3.6% in the year-ago month. In December last year, the mining production rose 5.1% and power output increased 1.2%. IIP grew 6.1% during the April-December 2023 period compared to a 5.5% expansion in the year-ago period. “Growth has been pulled down by electricity growth which was just 1.2% reflecting lower levels of demand. Eleven of the 23 manufacturing categories witnessed negative growth with the significant one again being electronic items. Textiles too continue to be in the negative zone due to lower export demand,” says Sabnavis. (With inputs from PTI)

Retail inflation eases to 3-month low of 5.1% in January, IIP grows 3.8% in December

Mumbai, The <keyword id="6355302" type="General" weightage="20" keywordseo="rupee" source="Orion">rupee</keyword> paused its two days of gains and settled 6 paise lower at 83.24 (provisional) against the US <keyword id="35208" type="General" weightage="20" keywordseo="dollar" source="Orion">dollar</keyword> on Thursday as rising crude oil prices dented the investor sentiment. Forex analysts said early gains in the domestic currency on the back of the weak dollar were reversed by the subdued domestic equity markets and concerns over foreign funds withdrawal. At the interbank foreign exchange, the rupee opened at 83.17 and then traded between the intra-day peak of 83.12 and the lowest level of 83.25 against the greenback. The local unit finally settled at 83.24 (provisional), registering a loss of 6 paise from its previous close. The rupee had settled 7 paise higher on Wednesday, a day after gaining 3 paise against the American currency. Market participants were also awaiting the industrial production data for August and inflation numbers for September to be released later in the day, which will provide insights into the country's economic health. Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, said the rupee is expected to trade with a slight positive bias on expectations of a decline in India's inflation and a rise in risk appetite in global markets. "Traders may remain cautious ahead of India's CPI and <keyword id="132840" type="General" weightage="20" keywordseo="iip-data" source="Orion">IIP data</keyword>. Traders may also take cues from US CPI, weekly unemployment claims and Federal Budget balance data. USD-INR spot price is expected to trade in a range of Rs 82.70 to Rs 83.60," Choudhary added. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.09 per cent lower at 105.72. Brent crude futures, the global oil benchmark, witnessed a sharp rise of 1.20 per cent to USD 86.85 per barrel. On the domestic equity market front, the BSE Sensex closed 64.66 points or 0.10 per cent lower at 66,408.39. The broader NSE Nifty declined 17.35 points or 0.09 per cent to 19,794. Foreign Institutional Investors (FIIs) were net sellers in the capital market on Wednesday as they offloaded shares worth Rs 421.77 crore, as per exchange data.

Rupee falls 6 paise against US dollar amid rising crude prices

<ul><li>Food basket inflation was at 9.53% in December 2023, up from 8.7% in November.</li><li>The core inflation stood at 3.8%, moderating from 4.% in November.</li><li>India's industrial growth rate slumped to an 8-month low of 2.4% in November. </li></ul>Retail inflation inched up marginally to a four-month high of 5.69% in December 2023, mainly on account of higher food prices, according to official data released on Friday. The inflation based on Consumer Price Index (CPI) was at 5.55% in November 2023 and 5.72% in December 2022. In August 2023, inflation touched a high of 6.83%. As per the data released by the <keyword id="20070866" type="General" weightage="20" keywordseo="national-statistical-office" source="keywords">National Statistical Office</keyword> (NSO), retail inflation in the food basket was at 9.53% in December 2023, up from 8.7% in the preceding month and 4.9% in the year-ago month. “While persistent rise in the food prices contributed to an uptick in inflation in December 2023, the core inflation has continued to moderate indicating signs of easing price pressure for the households. A continual moderation in inflation is supportive of growth in the consumption driven sectors, said <keyword id="20169700" type="General" weightage="20" keywordseo="vivek-rathi" source="keywords">Vivek Rathi</keyword>, national director of research at Knight Frank India. The core inflation stood at 3.8%, moderating from 4.% in November. As per RBI’s forecast, FY24 inflation would be at 5.4%. The softer numbers that came in December could undershoot the numbers marginally,” said <keyword id="20169699" type="General" weightage="20" keywordseo="upasna-bhardwaj" source="keywords">Upasna Bhardwaj</keyword>, chief economist at Kotak Mahindra Bank. Experts expect RBI to keep its keep repo rate and policy stance unchanged in the February policy. The <keyword id="19899810" type="General" weightage="20" keywordseo="reserve-bank-of-india" source="keywords">Reserve Bank of India</keyword> (RBI) has been focussed on bringing retail inflation under 4% which is its target. “We expect the RBI to allow liquidity conditions to ease in the coming months to let the operating target rate soften towards the repo rate before shifting stance— a move which is likely in 1QFY25,” said Bharadwaj. Manufacturing drags November industrial growth to 2.4% India's industrial growth rate slumped to an 8-month low of 2.4% in November from a 16-month high of 11.6% in October, data released by the Ministry of Statistics and Programme Implementation on Friday showed. In November 2022, the country’s industrial production had grown by 7.6%. The growth rate for November was dragged down by the manufacturing sector, which slowed to a crawl of 1.2 per cent on a year-on-year basis after having posted an increase of 10.2 per cent in October. The sharp slowdown in manufacturing output growth, which accounts for more than three-fourths of the index of industrial production (IIP), was partly attributed to the large number of holidays in November on account of festivals due to which the working declined. The IIP figure has been pulled down by the manufacturing sector which posted the lowest annualised growth of 1.2% in 13 months after a solid momentum in the early part of the fiscal. While moderation in industrial activity is typically seen in the post-festive season, this may also be an indication of an expectation of demand slowdown in the last quarter of the fiscal, he added. The electricity generation also grew at a slower pace of 5.8% as compared to a high double digit growth of 20.4% in October. Similarly, the mining output growth declined to 6.8% from 13.1% in October. “Industrial output for Nov-23 has disappointed even factoring in the impact of the festival holidays during the month and the adverse base factor. IIP has recorded a modest growth of 2.4% YoY, the lowest print in eight months since March 2023," said Suman Chowdhury, chief economist &amp; head of research of Acuite Ratings &amp; Research. There has also been a contraction in both consumer durables and non-durables output in Nov-23, leading to an overall contraction of 4.2 per cent YoY in the consumer goods sector. “The growth indicators from the industrial production print however seem to be uneven. Output from most of the key industries have witnessed moderate growth, however, due to a high statistical base. However, the consumer durable output, which is consumption reflection, contracted by 5.4%. This can be concerning as sustained consumption growth is the key to keep the economic growth momentum continuing,” said Rathi. (With inputs from PTI &amp; IANS)

Retail inflation inches to 4-month high in Dec; IIP growth slips to 8-month low in Nov

<keyword id="3658" type="COUNTRY" weightage="20" keywordseo="India">India</keyword>'s industrial production rose by 13.6 per cent in June, official data released on Thursday showed. According to the Index of Industrial Production (<keyword id="6427912" type="UNKNOWN" weightage="20" keywordseo="iip">IIP</keyword>) data released by the <keyword id="7734679" type="UNKNOWN" weightage="20" keywordseo="National-Statistical-Office">National Statistical Office</keyword> (<keyword id="2501810" type="ORGANIZATION" weightage="20" keywordseo="NSO">NSO</keyword>), the manufacturing sector's output surged by 13 per cent in June 2021. The mining output climbed 23.1 per cent and power generation increased by 8.3 per cent in June. The IIP had contracted 16.6 per cent in June 2020. During April-June this year, the IIP grew by 45 per cent against a contraction of 35.6 per cent in the same quarter last year. Industrial production has been hit due to the coronavirus pandemic since March last year when it had contracted 18.7 per cent. It shrank 57.3 per cent in April 2020 due to a decline in economic activities in the wake of the lockdown to curb the spread of coronavirus infections. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/corporates/news/vip-industries-wakes-up-from-a-long-slumber-to-reach-an-18-month-high/articleshow/85269746.cms">VIP Industries wakes up from a long slumber to reach an 18-month high</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/simple-energy-launching-one-electric-scooter-on-august-15-check-out-booking-price-battery-specification/articleshow/85268668.cms">Simple One electric scooter pre-bookings begin August 15 – check out the booking price, battery specs and more</a>

India's manufacturing sector grows by 13% in June, according to NSO data

New Delhi, Dec 12 () Rising food prices pushed the retail inflation in November to over three-year high of 5.54 per cent, while the industrial sector output shrank for third month in a row by 3.8 per cent in October, indicating deepening slowdown in the economy, government data showed on Thursday.
The retail inflation in November breached the Reserve Bank's medium-term target of 4 per cent, justifying the central bank's decision to keep the benchmark interest rate unchanged in its monetary policy earlier this month.
According to the data released by the National Statistical Office (NSO), costlier vegetables, pulses and protein rich items pushed the consumer price index (CPI) based retail inflation to a 40-month high in November.
The previous high was in July 2016, when retail inflation was at 6.07 per cent. The print stood at 4.62 per cent in October and 2.33 per cent in November 2018.
ICRA Principal Economist Aditi Nayar said that moderation in vegetable prices should douse food inflation to a large extent in early 2020, and healthy groundwater and reservoir levels bode well for rabi output and yields of various cereals.
However, the year-on-year decline in the area sown under rabi pulses and oilseeds poses a concern, given the high inflation being recorded by some of these items.
"ICRA expects the CPI inflation to spike further to 5.8-6 per cent in December 2019, close to the upper threshold of the MPC's medium-term target, driven by the recent revision in telecom tariffs. As a result, we expect the MPC (monetary policy committee of RBI) to remain on hold in its February 2020 policy review," she said.
Inflation in vegetables shot up to 35.99 per cent in November, as against 26.10 per cent in October. Likewise, the prices of cereals and eggs grew at a faster pace of 3.71 per cent. Prices of meat and fish rose by 9.38 per cent annually and of eggs by 6.2 per cent in November.
Prices of pulses and related products jumped 13.94 per cent during the month. In the fuel and light category, prices dropped 1.93 per cent.
On the other hand, the falling output of manufacturing, mining and electricity sectors pulled down the Index of Industrial Production (IIP) in October, as per the official data.
According to the National Statistical Office (NSO) data, the factory output declined by 4.3 per cent in September and 1.4 per cent in August this year, while it grew at 4.9 per cent in July.
Factory output, measured in terms of Index of Industrial Production (IIP), had expanded by 8.4 per cent in October 2018.
Notably, the Indian economy grew at the slowest pace in over six year at 4.5 per cent during the second quarter of the current fiscal. The GDP growth remained at 5 per cent in the first quarter ended June.
During April to October, the IIP growth remained almost flat at 0.5 per cent compared to 5.7 per cent in same period previous fiscal, showed the NSO data.
The manufacturing growth rate declined by 2.1 per cent in October as compared to 8.2 per cent a year ago. Power generation growth slipped sharply by 12.2 per cent in October, compared to 10.8 per cent in the year-ago period.
Mining output too fell 8 per cent in the month under review as against 7.3 per cent in the corresponding period last fiscal. Capital goods production, which is a barometer of investment, declined by 21.9 per cent in October compared to 16.9 per cent rise in the year-ago month.
In terms of industries, 18 out of 23 industry groups in the manufacturing sector have shown negative growth during October 2019 as compared to the same month last year.
The industry group 'manufacture of computer, electronic and optical products' has shown the highest negative growth of (-) 31.3 per cent followed by (-) 27.9 per cent in 'Manufacture of motor vehicles, trailers and semi-trailers'.
"India's November inflation has surged to 40-month high of 5.54 per cent, that is a 130 bps higher that RBI's medium term target of 4 per cent. This is mainly due to substantial increase in food prices. While Oct IIP print still remains in contraction at -3.8 per cent.
"At this month's policy, RBI refrained from cutting rates due to uptick in CPI despite slow growth. If inflation continues to rise further than RBI may continue to maintain a pause at the February policy," Rahul Gupta, Head of Research - Currency, Emkay Global Financial Services. KPM KKS NKD CS BAL

Retail inflation spikes to 3-yr high of 5.54 pc in Nov, IIP shrinks for 3rd month at 3.8 pc

Though RBI, in its last policy review on June 2 had hinted that there may not be any more cuts in the near term, it is likely to cut <keyword id="6371181" type="UNKNOWN" weightage="100" keywordseo="interest-rates">interest rates</keyword> in its upcoming monetary policy review next month despite <keyword id="513422" type="UNKNOWN" weightage="80" keywordseo="Retail-inflation">retail inflation</keyword> surging to an eight-month high in June, rating agency <keyword id="6423565" type="CITY" weightage="100" keywordseo="Moody">Moody</keyword>'s said today. 

	According to Moody's Analytics, the rise in CPI inflation was largely due to base effect.
 

	As per official data, retail inflation surged to an eight month high of 5.4 per cent in June, from 5.01 per cent in May. 
 

	It was 6.77 per cent in June last year.
 

	"Despite higher CPI inflation, the RBI will deliver another rate cut at its upcoming monetary policy review scheduled for August 4," Moody's Analytics Associate Economist Faraz Syed said in a research note. 
 

	The rise in inflation, a key factor considered by the RBI in deciding the monetary policy, comes in the backdrop of slowdown in factory output. 
 The Index of Industrial Production (<keyword id="6427912" type="ORGANIZATION" weightage="100" keywordseo="IIP">IIP</keyword>) in May slowed to 2.7 per cent from 5.6 per cent a year ago, leading to demands of rate cut from the RBI in its next policy review on August 4. 

	Syed further said that though food prices are rising, rainfalls have been "near average" levels in recent weeks which was one of the pre-condition, for the RBI to maintain an easing bias. 
 

	Moreover, the small rise in minimum support prices for maize and rice has been well below the average increases in previous years and should limit food inflation in the coming months, the report added. 
 
 

	Moody's Analytics expects the wholesale prices to fall further. The June wholesale price-inflation slipped to (-)2.4 per cent, from (-)2.36 per cent in May.
 

	According to Moody's Analytics, the WPI offers a better gauge of core inflation than the CPI and core inflation, in the WPI measure, has been falling in the past few months. 
 

	WPI inflation has been in the negative zone since November, 2014. 
 "Overall weak core inflation suggests <keyword id="35050" type="CITY" weightage="100" keywordseo="gdp">GDP</keyword> growth remains below potential. We think the RBI will cut the repo rate to 7 per cent in 2015," the report noted.

RBI likely to cut interest rates in its upcoming monetary policy review: Moody’s Analytics

Mumbai: <keyword id="19949639" type="General" weightage="100" keywordseo="Rupee" source="keywords">Rupee</keyword> appreciated 8 paise to 83.89 against <keyword id="19949640" type="General" weightage="20" keywordseo="US-dollar" source="keywords">US dollar</keyword> in early trade on Friday, supported by a positive trend in domestic equities and a decline in the US dollar index. Forex traders said post the <keyword id="19899810" type="General" weightage="20" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="261" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword>'s monetary policy announcement, markets now await for US CPI data, India CPI, WPI and IIP data and India's trade data all scheduled to be released next week. The Jackson Holes Symposium to be held after next week will also remain in focus, traders said. At the interbank foreign exchange, the rupee opened at 83.95 against the greenback, then touched 83.89, registering a rise of 8 paise over its previous closing price. On Thursday, the rupee consolidated in a narrow range and settled for the day lower by 2 paise at 83.97 against US dollar. Rupee was protected by the Reserve Bank of India (<keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords">RBI</keyword>) at 83.96 for this week and the local unit is likely to trade in a narrow range of 83.90/84.00 for the day after the RBI kept key benchmark rates on hold, said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.03 per cent lower at 103.17. Brent crude, the global oil benchmark, advanced 0.15 per cent to USD 79.28 per barrel. "Brent oil prices rose to USD 79.22, a 3 per cent weekly gain, on rising Middle East tensions and better than expected US jobless claims data giving a better outlook on the US economy," Bhansali added. Market analysts said while the rupee seems to be tilting towards a negative bias, but sharp fluctuations are not anticipated. Meanwhile, the Monetary Policy Committee (MPC) of the Reserve Bank kept the benchmark repurchase or repo rate unchanged at 6.50 per cent. Announcing the bi-monthly monetary policy review RBI Governor <keyword id="19913110" type="General" weightage="20" keywordseo="shaktikanta-das" source="keywords">Shaktikanta Das</keyword> said Indian rupee remained largely range-bound so far this financial year. Das further noted that the country's forex reserves touched a record high of USD 675 billion as on August 2. On the domestic equity market front, Sensex surged 958.63 points, or 1.22 per cent, to 79,844.85 points. The Nifty advanced 280.70 points, or 1.16 per cent, to 24,397.70 points. Foreign institutional investors (FIIs) were net sellers in the capital markets on Thursday as they offloaded shares worth Rs 2,626.73 crore, according to exchange data.

Rupee rises 8 paise to 83.89 against US dollar in early trade

New Delhi: India's Consumer Price Index (<keyword id="20468215" type="General" weightage="20" keywordseo="CPI" source="keywords">CPI</keyword>) <keyword id="19895000" type="General" weightage="100" keywordseo="inflation" source="keywords">inflation</keyword> dropped to 3.54 per cent in July 2024, its lowest in nearly five years, largely driven by a decline in <keyword id="20028256" type="General" weightage="20" keywordseo="vegetable" source="keywords">vegetable</keyword> <keyword id="19900607" type="General" weightage="20" keywordseo="prices" source="keywords">prices</keyword>. However, despite this positive development, the <keyword id="19934368" type="General" weightage="20" keywordseo="State-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="State Bank of India" meta.hostid="261" meta.entityid="State Bank of India">State Bank of India</keyword> (<keyword id="19898108" type="General" weightage="20" keywordseo="SBI" source="keywords">SBI</keyword>) has cautioned that the path forward may be challenging, according to the SBI research report. The dramatic reduction in vegetable inflation, which plummeted from 29.3 per cent in June to a mere 6.8 per cent in July, played a crucial role in achieving this multi-year low. The weighted contribution of vegetables to the overall CPI also shrank from 1.77 per cent in June to 0.55 per cent in July, underscoring their impact on the headline inflation figure. Additionally, the prices of fruits and fuel showed signs of moderation, contributing further to easing inflationary pressures. However, this broad-based relief was tempered by a slight uptick in core CPI inflation, which excludes food and fuel prices. The SBI's latest report highlights that the once-dominant "Follow the Fed" mantra appears to be waning, with an increasing number of central banks prioritizing domestic economic conditions over synchronizing with U.S. rate decisions, signaling a shift in global <keyword id="20104157" type="General" weightage="20" keywordseo="monetary-policy" source="keywords">monetary policy</keyword> dynamics. This decline in CPI marks the first time in half a decade that CPI inflation has dipped below the Reserve Bank of India's (RBI) target of 4 per cent, a feat largely attributed to a steep fall in vegetable prices. Core CPI rose from 3.12 per cent in June to 3.30 per cent in July, driven primarily by an increase in mobile tariffs. Notably, the transport and communication segment saw inflation rise sharply from 0.97 per cent in June to 2.48 per cent in July, indicating sector-specific pressures. The moderation in food inflation, which stood at 5.06 per cent year-on-year in July, was significantly influenced by a higher base effect. Despite this, concerns persist over the uneven distribution of monsoon rainfall, particularly in key foodgrain-producing states experiencing deficient precipitation. With La Nina conditions gaining strength, the possibility of excessive rainfall in August and September looms large, raising fears of crop damage that could reignite food price inflation. Looking ahead, inflationary pressures may persist, potentially exceeding the RBI's forecast of 4.5 per cent for FY25. The domestic growth momentum remains robust, with GDP expected to surpass 7 per cent in Q1 FY25. However, geopolitical uncertainties continue to pose risks to the growth outlook. The RBI, maintaining a tight liquidity stance to control inflation, has deferred potential rate cuts to December 2024 or February 2025. State-wise analysis reveals that the majority of states recorded CPI inflation rates below the national average, with only six out of 22 states experiencing higher-than-average inflation. Despite this, significant rural-urban inflation differentials were observed, with most states seeing higher inflation in rural areas compared to urban counterparts. Only four states reported higher urban inflation. Historically, when the U.S. Federal Reserve adjusts its interest rates, global capital flows are impacted, prompting central banks in emerging markets to follow suit. However, while the Fed's recent rate hike cycle (2022-2023) saw a synchronized global response, the current rate-cutting phase is proving to be less coordinated. Central banks in countries like China, Chile, Brazil, Mexico, the UK, Canada, and the European Central Bank have already begun reducing rates, while the Fed is expected to initiate cuts in September 2024. India's Index of Industrial Production (IIP) grew by 4.2 per cent in June 2024, down from a revised 6.2 per cent in May. The mining sector led the growth with a 10.3 per cent increase, followed by electricity at 8.6 per cent and manufacturing at 2.6 per cent. For the April-June 2024 period, industrial growth stood at 5.2 per cent, compared to 4.7 per cent in the same period the previous year. As India navigates the delicate balance between growth and inflation, the coming months will be critical in shaping the country's economic trajectory, especially with potential global shifts in monetary policy and the evolving monsoon season.

CPI inflation drops to lowest in five years but road ahead could be bumpy: SBI Report

<ul><li>India’s <keyword id="44910" type="General" weightage="20" keywordseo="gdp-growth" source="Orion">GDP growth</keyword> for the April-June quarter came below estimates at 13.5% percent.</li><li>Rating agencies have trimmed their annual growth rate projections after the quarterly data was released by the government.</li><li>"We strongly believe that the estimation of manufacturing sector growth needs serious introspection in the sense that IIP is still indexed at 2012 base,” said SBI Ecowrap.</li><li>Analysts are worried that organizations may not go through with all the capex plans that they have announced.</li></ul>The GDP growth rate for the April-June quarter which came in at 13.5%, fell short of expectations. As a result, rating agencies already lowered their annual estimates, yet again. Most of the forecasts now believe that Indian GDP will grow at 7% or below. The Reserve Bank of India however believes that it will grow at 7.2%. SBI Ecowrap trimmed its estimates as it had expected April-June GDP to grow at 15.7%. "We strongly believe that the estimation of manufacturing sector growth needs serious introspection in the sense that IIP is still indexed at 2012 base," the report said. In addition to SBI Ecowrap, Citibank and Goldman Sachs too trimmed their projections. “Rising interest rates, uneven distribution of monsoons and slowing global growth will dampen economic momentum,” said Moody’s yesterday. It cut calendar year 2023 growth rate projections to 5.2%. This is the second round of trimming by agencies after seven of them slashed their growth rate projections after the Jan-Mar quarter data was released by the government. New set of downgrades <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Institution </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">GDP forecast cut FY23 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Earlier projection </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">SBI </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.8% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.5% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Citibank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.7% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Goldman Sachs </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.2% </td></tr></tbody></table> A lot has changed since the beginning of the year as many agencies hoped that <keyword id="113229" type="General" weightage="20" keywordseo="india-gdp" source="Orion">India GDP</keyword> growth would be above 7%. A big jolt to this belief came this May itself when the following projections have been trimmed. Downgrades after Jan-Mar quarter GDP data release <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Institution </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">GDP forecast cut FY23 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Earlier projection </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Moody’s </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">5.2% (Calendar year 2023) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">5.4% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">YES Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.9% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">International Monetary Fund (IMF) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.4% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.2% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Nomura </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">4.7% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">5.4% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FICCI </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.4% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Asian Development Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.2% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.5% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">CRISIL </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.3% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.8% </td></tr></tbody></table> High inflation rate is worrying most analysts. “Growth challenges are likely to remain in FY23 and the K-shaped recovery is expected to continue. While many remain hopeful of a recovery in private sector capex, we remain skeptical as recent RBI data indicates that even as the number of projects announced for FY23 are higher than the previous year, the expected cumulative spend remains lower than the pre-pandemic levels,” said a report by YES Bank on August 31. Most analysts are worried that organizations may not go through with all the high capex plans that they have announced. They maintain a bias towards more downward revisions unless domestic inflation moderates or global commodity prices cool meaningfully. “Overall, it confirms that growth recovery is not so strong in India. It ideally implies that monetary tightening should not be very aggressive. However, it appears that the terminal repo rate will be 5.75-6% in this cycle with one or two more rate hikes, ending the cycle in December 2022,” said Nikhil Gupta, chief economist at Motilal Oswal Financial Services group. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/india/news/laxman-narasimhan-named-as-the-ceo-of-coffee-chain-starbucks/articleshow/93939910.cms">Laxman Narasimhan named as the CEO of coffee chain Starbucks</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/corporates/news/recession-in-the-us-may-cool-off-attrition-in-it-sector-along-with-revenues/articleshow/93942471.cms">Recession in the US may cool off attrition in IT sector along with revenues</a>

Rating agencies revise GDP growth estimates yet again, most now peg it below 7%

Equity benchmark <keyword id="6484188" type="General" weightage="100" keywordseo="sensex" source="Orion">Sensex</keyword> rallied over 300 points in opening trade to hit a fresh lifetime high on Tuesday, tracking gains in index heavyweights ICICI Bank, HDFC Bank and M&amp;M despite a weak trend in global markets. After touching a record of 60,621.72, the 30-share Sensex was trading 261.17 points or 0.43% higher at 60,545.48. Similarly, the <keyword id="6354813" type="General" weightage="20" keywordseo="nifty" source="Orion">Nifty</keyword> surged 97.75 points or 0.54% to a new intra-day peak of 18,089.70. M&amp;M was the top gainer in the Sensex pack, rallying over 3%, followed by <keyword id="66427" type="General" weightage="20" keywordseo="powergrid" source="Orion">PowerGrid</keyword>, <keyword id="6354287" type="General" weightage="20" keywordseo="bharti-airtel" source="Orion">Bharti Airtel</keyword>, L&amp;T, ICICI Bank and Axis Bank. On the other hand, <keyword id="6356830" type="General" weightage="20" keywordseo="nestle-india" source="Orion">Nestle India</keyword>, HUL, HCL Tech, SBI and <keyword id="6357147" type="General" weightage="20" keywordseo="tata-steel" source="Orion">Tata Steel</keyword> were among the laggards. In the previous session, the 30-share index ended 148.53 points or 0.25% higher at record 60,284.31, and Nifty rose 46 points or 0.26% to its fresh closing peak of 17,991.95. Foreign institutional investors (FIIs) were net sellers in the capital market as they offloaded shares worth Rs 278.32 crore on Tuesday, as per exchange data. Domestic equities look to be good as of now, said Binod Modi Head-Strategy at Reliance Securities. “Sharp contraction in CPI print at 4.35% for September despite elevated oil prices and sustained IIP growth (11.5% growth for August) certainly offer comfort. We also believe that 2QFY22 corporate earnings are going to be quite crucial for the market,” he stated. Retail inflation fell to a five-month low of 4.35% in September from 7.27% in the year-ago period as prices of vegetables and other items declined. Industrial production grew 11.9% in August mainly due to a low-base effect and good performance by manufacturing, mining and power sectors that surpassed the pre-COVID level. In the US, the equity market contracted for the third consecutive day in a choppy trading day ahead of crucial inflation data and September quarter earnings. Elsewhere in Asia, bourses in Shanghai and Tokyo were trading with losses in mid-session deals, while Seoul was positive. Meanwhile, international oil benchmark Brent crude fell 0.31% to $83.16 per barrel. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/advertising/ad-tech/news/inmobi-acquires-uk-based-appsumer-which-helps-picsart-miniclip-with-its-digital-marketing-efforts/articleshow/86988865.cms">InMobi acquires UK-based Appsumer, which helps Picsart, Miniclip with its digital marketing efforts</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/android-phones-constantly-send-data-from-pre-installed-apps-even-if-theyve-never-been-used-before/articleshow/86988368.cms">Research reveals Android phones constantly send data from pre-installed apps even if they’ve never been used before</a>

You Searched For "august iip" and got 11 results

Retail inflation declines to 6.83% in August on falling food prices; July IIP at 5.7%

BI India Bureau

Retail inflation eases to 3-month low of 5.1% in January, IIP grows 3.8% in December

BI India Bureau

Rupee falls 6 paise against US dollar amid rising crude prices

PTI

Retail inflation inches to 4-month high in Dec; IIP growth slips to 8-month low in Nov

BI India Bureau

India's manufacturing sector grows by 13% in June, according to NSO data

PTI

Retail inflation spikes to 3-yr high of 5.54 pc in Nov, IIP shrinks for 3rd month at 3.8 pc

PTI

RBI likely to cut interest rates in its upcoming monetary policy review: Moody’s Analytics

BI India Bureau

Rupee rises 8 paise to 83.89 against US dollar in early trade

PTI

CPI inflation drops to lowest in five years but road ahead could be bumpy: SBI Report

ANI

Rating agencies revise GDP growth estimates yet again, most now peg it below 7%

Bhakti Makwana

Sensex rallies over 300 points, Nifty near 18,100 level — M&M, PowerGrid, Bharti Airtel, L&T, ICICI Bank and Axis Bank top gainers

PTI

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