Perspective on IIP CPI numbers By Mr. Vivek Rathi, Knight Frank India
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Below is Perspective on IIP CPI numbers By Mr. Vivek Rathi, Director Research, Knight Frank India.
“In the chronology of events leading to high domestic consumer inflation, there were indications that it will continue to peak even for the April 2022 print. Hence, despite crude oil price cooling off from its peak levels in March, the cascading effect of increase in domestic fuel price is reflecting on the latest consumer inflation number. Besides, food inflation is also at an elevated level in the country and globally, which is a concern for the domestic economy. The recent price moderation in crude and some commodities as a fallout of tightening liquidity and increased credit costs is expected to play a role in inflation moderation in the near term. This should also lend comfort to the RBI to maintain a status quo on policy rate in the upcoming Monetary Policy Committee meeting.
The real estate sector has been constrained with increased construction costs, however strong consumer enthusiasm for property purchase has ensured that the sector remains on a strong foot at this challenging juncture. Meanwhile, in Mar 2022, IIP grew by 1.9%, indicating at the economy’s resilience despite intensifying price pressures. Industrial production growth was led by sharp sequential recovery across all the categories. The sooner the geopolitical tension on account of war and trade sanctions ease, better it will get for global economic growth and price stability.”
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