Indian Inflation Rates Exhibit Decline Amidst Stable Monetary Policy

In January, India experienced a decline in inflation rates, reaching the lowest point in three months, due to a moderation in food prices.

This provides a measure of relief to the Monetary Policy Committee of the Reserve Bank of India (the central bank), amidst concerns about inflationary pressures spreading to other sectors of the economy.

The Indian Ministry of Statistics reported that in the past January, the Consumer Price Index (CPI) in India saw a year-on-year increase of 5.1%, which aligns with the analysts’ average estimate of 5% as surveyed by Bloomberg News.

This rate is on a monthly basis, as compared to 5.69% in the previous December.

Bloomberg stated that the inflation rate declined last month thanks to an increased supply of vegetables and grains, which helped to slow down the rate of rise in food commodity prices.

The inflation rate for food prices in India fell last month to 8.3%, down from 9.53% in the previous month. Food prices account for about half of the components of the overall inflation rate in India, according to the Oman News Agency.

Last week, the Reserve Bank of India decided to maintain interest rates at their current levels without any changes.

The governor of the Reserve Bank of India anticipates that the primary inflation rate for consumer prices will reach 5.4% in the current fiscal year, and it’s expected to settle at 4.5% in the duration between 2024 and 2025.