Mumbai: Official data on Tuesday confirmed that the RBI’s inflation mark of 4 percent was breached by a sudden sharp spurt in food and fuel prices, in fact a 13 month high of 4.88 percent.
The Ministry of Statistics & Programme Implementation shared data from October's consumer price index (CPI) inflation which showed a marked-rise rise in November (4.88 percent) from October (3.58 percent).
A Reuters report hinted that the inflation hike may have been caused by un-seasonal rains in November, sending food prices to soar without control.
On Monday, Reuters quoted Rupa Rege Nitsure, Group Chief Economist at Larsen & Toubro as saying that inflation rate is unlikely to push the central bank to change key rates any time soon.
India's economic growth rebounded in the three months ending in September with businesses starting to overcome troubles from implementation of the new tax. "We still have some output gap but it's not as bad as it used to be a couple of quarters back. It will not make any sense for the RBI to just react to the (inflation) number.
Slow Industrial Output
Data also showed industrial output slow in October to 2.2 percent. In September, the industrial output hovered at 4.14 percent.
"The general index for the month of October 2017 stands at 123, which is 2.2 percent higher as compared to the level in the month of October 2016.”
“The cumulative growth for the period April-October 2017 over the corresponding period of the previous year stands at 2.5 per cent," shared a "Quick Estimates" note from the Index of Industrial Production (IIP).
The slowdown, the Central Statistics Office (CSO), reasoned was attributed to deceleration in manufacturing and mining outputs.
On a year-on-year basis, manufacturing sector expanded by 2.5 percent, while mining output was a mere 0.2 percent. The sub-index of electricity generation expanded by 3.2 percent.