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Retail inflation eases to 2.3% as pressure cools off, IIP grows 8%

Shaktikanta Das will chair the next monetary policy committee meeting in February

Ishan Bakshi  |  New Delhi 

economy, iip, iip inflation

Two key indicators of macro economy— and retail price inflation — improved their performance in October and November, respectively. Industrial activity grew at an 11-month high of 8.1 per cent in October, while the rate fell to a 17-month low of 2.33 per cent in November, showed the latest data released by the Central Statistics Office (CSO).

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With inflation consistently undershooting the Monetary Policy Committee's target, it increases the likelihood of a change in policy stance from calibrated tightening to neutral, which could serve as a precursor to a rate cut. Reserve Bank of India Governor Shaktikanta Das will chair the next monetary policy committee meeting in February.

The index of rose from 4.5 per cent in September, with the major sectors registering strong growth. Manufacturing, which accounts for roughly three-fourths of the index, grew 7.9 per cent in October, from 4.6 per cent in September. Electricity generation and mining output increased by 10.8 per cent and 7 per cent from 8.2 per cent and almost 0 per cent, respectively. Capital goods, which denotes investment activity, grew by 16.8 per cent.

The consumer price index (CPI) fell from 3.38 per cent in October, on the back of falling food prices, correction in retail fuel prices and the waning impact of the Housing Rent Allowance revision. The consumer food price index contracted by 2.61 per cent in November, with major segments such as vegetables, pulses and sugar contracting.

The consumer price index (CPI) fell from 3.38 per cent in October, on the back of falling food prices, correction in retail fuel prices and the waning impact of the Housing Rent Allowance revision. The consumer food price index contracted by 2.61 per cent in November, with major segments such as vegetables, pulses and sugar contracting.

First Published: Thu, December 13 2018. 02:22 IST
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