New Delhi: Retail inflation soared to 5.39% in April on higher food prices, reversing a downward trend seen in recent months.
The annual rate of price rise, based on consumer price index, in the previous month stood at 4.83%, the lowest in six months. In April 2015, the rate of price rise was at 4.87%.
The accelerated pace of inflation may play a spoilsport to any further interest rate cut by RBI, even as a sharp plunge in industrial production growth may still add to clamour for easing of monetary policy.
Food inflation rose to 6.32% in April against 5.21% in March, the data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Thursday showed. The rate of price rise in vegetables quickened to 4.82% while fruits turned costlier by 1.66% in April.
Generally, prices of fruits, vegetables and prepared food rise during summer season due to less availability.
Inflation in 'cereals and products' remained flat at 2.43%, but rose for 'meat and fish' category at 8.07% and also for 'oil and fats' at 5.04%. The rate of price rise in commodities such as eggs and 'pulses & products' was slower than a year ago at 6.64% and 34.13% respectively. Likewise, cost of fuel and light was also less from a year ago, as inflation softened to 3.03%.
The prices are collected by the government from selected towns by the Field Operations Division of National Sample Survey Organisation (NSSO) and from selected villages by the Department of Posts.
"From the perspective of RBI,...they will have to see what the future numbers come out and that would be the direction for RBI (for a rate cut in next policy meet)", said Indranil Pan, Chief Economist IDFC Bank.
Industrial production growth plunged to 0.1% in March due to poor performance of manufacturing and mining sectors coupled with sharp decline in output of capital goods. Industry had grown by 2.5% in March 2015.
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