Expect retail inflation to remain close to 5%: SBI Research report
Retail inflation, or the Consumer Price Index (CPI) in India, is expected to remain below or close to 5.0 percent in the remaining months of 2024-25, except for September, according to SBI Research.
India's retail inflation rate increased in June, deviating from the moderation seen in previous months, driven by rising food prices.
The year-on-year inflation rate based on the all-India Consumer Price Index (CPI) was 5.08 percent (provisional) for June 2024. The corresponding inflation rates for rural and urban areas were 5.66 percent and 4.39 percent, respectively.
Twelve states had inflation rates above India's overall rate of 5.1 percent in June. Odisha recorded the highest inflation rate at 7.22 percent, followed by Bihar at 6.37 percent and Karnataka at 5.98 percent.
Inflation is highest in Odisha at 7.22% followed by Bihar and Karnataka: SBI research
«With the monsoon progressing satisfactorily and overall seasonal variations balancing out, we do not expect any significant deviation in the inflation outlook,» stated a report from SBI Research authored by Soumya Kanti Ghosh, Group Chief Economic Adviser at the State Bank of India.
Furthermore, with US inflation having declined by 0.1 percent from May, putting the 12-month rate at 3 percent, its lowest level in more than three years, there are grounds for a potential Fed rate cut by September, the report noted.
«We, therefore, feel the RBI will revisit the policy stance around that time in line with our expectations,» the SBI Research
