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Perspective on CPI data By Mr. Nikhil Gupta, Motilal Oswal Financial Services
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Below is Perspective on CPI data By Mr. Nikhil Gupta, Chief Economist at Motilal Oswal Financial Services
Feb'22 headline CPI at 6.1% YoY, in line with market consensus but higher than our expectations
FY23 inflation could average ~5.5%
Headline CPI came in at 8-month high of 6.1% YoY in Feb'22, in line with market consensus (6%) but higher than our forecast (5.8%).
Within food items, some items (cereals, vegetables etc) saw higher inflation, while others (pulses, oil & fats etc) saw slower inflation. However, food inflation at 15-month high of 5.8% was higher than our forecast of 5.2%.
Excluding vegetables, inflation was unchanged at 10-month high of 6.1% last month.
Core inflation was unchanged at 6.2% YoY for the fifth consecutive month.
Although inflation was slightly higher and will likely be higher than RBI forecasts (~4.5%), it is unlikely to lead to any interest rate action next month. *We don't expect more than 90bps rate hike in reverse repo rate (or 50bps hike in repo rate) in FY23.
Above views are of the author and not of the website kindly read disclaimer
