RBI MPC minutes: Panelists flag incoming impact of 'exceptionally' warm summers on food inflation
Reserve Bank of India's Monetary Policy Committee have flagged worries relating to price worries in coming months owing to 'exceptionally' warm summer months experienced across the country, as per the Minutes of the June meeting released on Friday.
RBI Governor Shaktikanta Das opined that retail inflation in India would moderate to an average of 4.5 per cent in FY25, higher than the target of 4 per cent.
«In the immediate months, however, the impact of exceptionally warm summer months on output of certain perishables; a likely rabi production shortfall in some pulses and vegetables – particularly potatoes and onions; and the upward revisions in milk prices, warrant close monitoring,» Das said.
«Headline CPI inflation is moderating, but at a very slow pace. The last mile of disinflation is turning out to be gradual and protracted,» Das added.
Jayanth Varma said that while headline and core inflation in India have moderated as anticipated, there is 'little' comfort in the near-term.
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«There is, however, little comfort in the near-term with inflation projected to remain sticky at around 4.9 per cent in Q1FY25 primarily due to the impact of unprecedented heat wave conditions on summer crop of vegetables and fruits; lower agricultural and horticulture production estimates; revision in milk prices across major cooperatives; and signs of a turnaround in commodity prices along with logistics and transportation costs,» Varma had
