India's retail inflation eases to 11-month low of 4.83% in April

India's retail inflation rate  dropped to a 11-month low of 4.83% in April, offering a glimmer of optimism for the economy amid ongoing concerns over food price uncertainties. The drop in inflation, though encouraging, comes against a backdrop of persistent challenges in the food market, signaling a complex inflation trajectory in the months ahead.
According to the report published by the National Statistical Office (NSO) on Monday, the inflation in the food basket grew at 8.7 per cent in April, up from 8.52 per cent in March.Consecutively,in April, India's retail inflation slightly decreased to 4.83 percent annually from 4.85 percent the previous month.
Meanwhile, fuel prices sustained a deflationary trend for the sixth consecutive month in February. The core Consumer Price Index (CPI), excluding food and fuel, witnessed disinflation, dropping to 3.4 per cent in February. This figure marks one of the lowest levels in the current CPI series, with both goods and services components experiencing a decline in inflation. In its April 2024 meeting, the MPC left its inflation forecast for this fiscal year unchanged at 4.5 per cent assuming normal monsoon, even as the country braces for a scorching summer amid a spike in crude oil prices and persisting worries about supply chain due to the Red Sea crisis.
With the Reserve Bank of India's (RBI) upcoming June monetary policy review on the horizon, CRISIL Chief Economist Dharmakirti Joshi suggests that the likelihood of a stance change appears rather dim, given the prevailing uncertainties. The central bank, tasked with maintaining price stability while supporting economic growth, faces a delicate balancing act amidst the backdrop of external shocks and domestic challenges.

(Ira Singh, Asstt Editor, Gandhinagar)