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Even at 4.25% inflation rate, Das sees disinflation process as protracted

Waning of base effect and uncertainty over monsoon may come in the way of disinflation, going forward

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Photo: Bloomberg

5 min read Last Updated : Jun 20 2023 | 4:21 PM IST

At the outset, Reserve Bank of India (RBI)'s Governor Shaktikanta Das' statement that the process of retail disinflation would be slow and protracted even as the inflation rate fell to a 25-month low of 4.25 per cent in May seems surprising. The inflation rate is quite close to RBI's target of four per cent but even then the governor said the central bank may meet its goal on inflation only in the medium term.

This also seems surprising because the wholesale price index (WPI) was in deflation for the second month in a row at 3.48 per cent in May.

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