India’s retail inflation in May eases to 25-month low of 4.25%; April’s IIP rises to 4.2%

India's retail inflation in May eased to a 25-month low of 4.25 per cent, data released by the National Statistical Office (NSO) on Monday showed.

India’s retail inflation in May eased to a 25-month low of 4.25 per cent, data released by the National Statistical Office (NSO) on Monday showed. Meanwhile, India’s Index of Industrial Production (IIP) in April rose sharply to 4.2 per cent from 1.1 per cent in March.

The headline inflation or consumer price inflation (CPI) last month at 4.25 per cent remained below the upper threshold of the Reserve Bank of India’s medium-term 4+/- 2 percent target.

The retail inflation remained within the tolerance range of the RBI for the third consecutive month. In April, India’s retail inflation eased to an 18-month low of 4.70 per cent, while in March, it stood at 5.66 per cent.

The consumer food price index (CFPI) in May eased to 2.91 per cent from 3.84 per cent in April.

India’s rural inflation stood at 4.17 per cent in the last month while urban inflation stood at 4.27 per cent.

The Reserve Bank of India in its bimonthly monetary policy last week revised India’s inflation projection to 5.1 per cent from 5.2 per cent for the FY24, as it extended the pause on repo rate hike, and kept the key lending rate unchanged at 6.50 per cent.

The central bank said, “The pace of monetary tightening has slowed in recent months, but uncertainty remains on its future trajectory as inflation continues to rule above targets across the world.”

“(For India) Close and continued vigil on the evolving inflation outlook is absolutely necessary, especially as the monsoon outlook and the impact of El Nino remain uncertain,” it added.