India’s inflation surges to 8-month high on soaring food prices | Business and Economy News
Things could get worse for India amid supply disruptions caused by Russia’s war in Ukraine.
Published on March 14, 2022
India’s main inflation rose to an eight-month high in February on higher food prices, with the outlook deteriorating amid supply disruptions caused by Russia’s war in Ukraine.
Consumer prices rose 6.1% last month from a year earlier, the Statistics Department said in a statement on Monday. This is faster than the median estimate of a 6% increase seen in a Bloomberg survey of economists and well above the Reserve Bank of India’s inflation target. Degree.
The uncertainty caused by the war is likely to force the central bank to revisit its forecasts for inflation and growth at next month’s policy meeting. Although, it is unlikely to force the RBI to tighten interest rates, as policymakers ‘are intent on supporting a durable recovery of the economy.
- Data showed that rising costs of food and clothing and footwear contributed to the rise in prices last month. Food prices increased by 5.9%, clothing and footwear prices by 8.9% and housing prices by 3.6%. Fuel and electricity prices rose 8.7%, slower than the 9.3% pace seen in January
- Pump prices have been frozen for more than four months to coincide with elections in several key Indian states. That could change if fuel retailers start shifting crude prices higher due to Russia’s war
- Rising prices could weigh on consumption as high-frequency indicators point to risks for the world’s fastest-growing major economy
- Amid high input costs and supply shortages, wholesale inflation accelerated to 13.1% in February, separately released data showed on Monday.
(Update print inflation details in ‘Dig deeper’ section)
–With support from Tomoko Sato.