In the run-up to the Monetary Policy Committee (MPC) meeting, global commodity prices have retraced to almost the pre-Ukraine conflict levels and the Consumer Price Index (CPI) trajectory in India has broadly followed the expected path. While this will provide a sense of comfort to the MPC, there are again some brewing supply-side shocks on food prices that can pose upside risks to near-term inflation prints.
Deficient rainfall in some parts of the country is threatening prices of rice and pulses, while excess rainfall in others is causing vegetable prices, particularly tomatoes, to move up again. The trend in food
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