ALSO READIndia's December retail inflation hits 17-month high of 5.21 percent Rising food prices push India's August retail inflation to five-month high India's June inflation slowest in more than five years India's October retail inflation touches seven-month high India's November retail inflation breaches RBI's 4 percent target
By Manoj Kumar
NEW DELHI (Reuters) - Rising food prices pushed India's retail inflation to a 17-month high in December, breaching the central bank's medium-term target for the second straight month, which could intensify pressure for it to raise policy rates in the next few months.
Annual retail food inflation rose 4.96 percent in December from 4.35 percent in the previous month.
The RBI, which has a medium-term inflation target of 4 percent, has raised its inflation estimate to 4.3 percent to 4.7 percent for the six months through March. But some analysts feel inflation could overshoot its estimates.
The RBI holds its next policy review on Feb. 7.
The U.S. central bank is forecasting three rate hikes for 2018. It raised rates three times last year.
While the world's seventh largest economy is expected to grow at 6.5 percent in the current fiscal year ending in March, a continued rise in inflation from 1.46 percent in June, the lowest on record since 2012, has alarmed policymakers in New Delhi.
Despite a cut in taxes, retail petrol prices have risen 5.6 percent and diesel by 9 percent since June in the Indian capital.
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