CPI inflation likely to be at 5.3-5.6% in September
Falling vegetable prices, impact of LPG price cut expected to have helped
- Oct 11, 2023,
- Updated Oct 11, 2023 1:08 PM IST
Retail inflation as measured by the consumer price index (CPI) may have eased marginally in September to within the Reserve Bank of India’s tolerance zone of 6 per cent as prices of vegetables eased and the impact of the LPG price cut was felt.
According to Rahul Bajoria, MD & Head of EM Asia (ex-China) Economics, Barclays, CPI inflation is estimated to have cooled to 5.3 per cent in September from 6.8 per cent in August. “An easing in food and fuel inflation likely drove a softening in the headline rate. Sequentially, we estimate that the CPI declined by -0.9 per cent month on month in September, compared with a -0.1 per cent drop in August,” he said in a note. CPI inflation is expected to moderate further in the fourth quarter of the fiscal.
CRISIL’s monthly indicator of food plate cost also indicates that falling tomato prices pulled down the cost of vegetarian and non-vegetarian thalis by 17 per cent and 9 per cent month on month, respectively, in September. According to its Roti Rice Rate, the major contribution in the decline in the cost of a vegetarian thali was from tomato prices, which declined by about 62 per cent on-month to Rs 39 per kg in September 2023 from Rs 102 per kg in August.
The cost of fuel, which accounts for 14 per cent and 8 per cent of total cost of vegetarian and non-vegetarian thalis, respectively, declined by about 18 per cent on-month in September as the cost of a 14.2kg LPG cylinder fell to Rs 903 from Rs 1,103, it further noted.
JM Financial in a note said that retail inflation is likely to average at 5.5–5.6 per cent in September, taking the average inflation in the second quarter of the fiscal to 6.6 per cent.
Retail inflation had touched a 15-month high of 7.44 per cent in July as vegetable prices, especially of tomatoes, had skyrocketed. It had eased marginally to 6.83 per cent in August but has remained a source of concern. Official data on the CPI print for September will be released on Thursday.
The Monetary Policy Statement of the RBI also observed that the unprecedented food price shocks are impinging on the evolving trajectory of inflation and resolved to remain on high alert, given the prevailing environment of elevated global food and energy prices and global financial market volatility.
Also Read: Gold and silver prices today: Yellow metal holds near highest level, rising by 0.10%
Retail inflation as measured by the consumer price index (CPI) may have eased marginally in September to within the Reserve Bank of India’s tolerance zone of 6 per cent as prices of vegetables eased and the impact of the LPG price cut was felt.
According to Rahul Bajoria, MD & Head of EM Asia (ex-China) Economics, Barclays, CPI inflation is estimated to have cooled to 5.3 per cent in September from 6.8 per cent in August. “An easing in food and fuel inflation likely drove a softening in the headline rate. Sequentially, we estimate that the CPI declined by -0.9 per cent month on month in September, compared with a -0.1 per cent drop in August,” he said in a note. CPI inflation is expected to moderate further in the fourth quarter of the fiscal.
CRISIL’s monthly indicator of food plate cost also indicates that falling tomato prices pulled down the cost of vegetarian and non-vegetarian thalis by 17 per cent and 9 per cent month on month, respectively, in September. According to its Roti Rice Rate, the major contribution in the decline in the cost of a vegetarian thali was from tomato prices, which declined by about 62 per cent on-month to Rs 39 per kg in September 2023 from Rs 102 per kg in August.
The cost of fuel, which accounts for 14 per cent and 8 per cent of total cost of vegetarian and non-vegetarian thalis, respectively, declined by about 18 per cent on-month in September as the cost of a 14.2kg LPG cylinder fell to Rs 903 from Rs 1,103, it further noted.
JM Financial in a note said that retail inflation is likely to average at 5.5–5.6 per cent in September, taking the average inflation in the second quarter of the fiscal to 6.6 per cent.
Retail inflation had touched a 15-month high of 7.44 per cent in July as vegetable prices, especially of tomatoes, had skyrocketed. It had eased marginally to 6.83 per cent in August but has remained a source of concern. Official data on the CPI print for September will be released on Thursday.
The Monetary Policy Statement of the RBI also observed that the unprecedented food price shocks are impinging on the evolving trajectory of inflation and resolved to remain on high alert, given the prevailing environment of elevated global food and energy prices and global financial market volatility.
Also Read: Gold and silver prices today: Yellow metal holds near highest level, rising by 0.10%