July 13 (Reuters) – India’s retail inflation accelerated to 4.38% in June, government data showed on Monday, breaching the central bank’s 4% target for the first time in 16 months and setting the stage for an interest rate hiking cycle.
COMMENTARY:
SAKSHI GUPTA, PRINCIPAL ECONOMIST, HDFC BANK, GURUGRAM
“Inflation inched up by close to 45 basis points in June to 4.4%, mainly driven by some increase in food and fuel inflation as the impact of a revision in petrol and diesel prices played out. However, lower gold prices pulled down the increase in the headline print.
The uncertainty over the West Asia conflict along with an uneven monsoon continues to cast a shadow over the inflation outlook. We continue to estimate inflation to average at 5.2% for FY27, assuming an average oil price of $80 pbl.”
(Reporting by Anuran Sadhu; Editing by Sonia Cheema)
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