India`s retail inflation eases to five-month low in January
India's retail inflation eased to a five-month low of 4.31% in January from 5.22% in December as food price inflation declined, government data released on Wednesday showed.
Annual retail inflation in January was lower than economists' estimate of 4.6%.
HARRY CHAMBERS, ASSISTANT ECONOMIST, CAPITAL ECONOMICS, LONDON
"The sharp fall in Indian headline consumer price inflation in January reinforces our view that the RBI will continue to loosen monetary policy over the coming months to support the economy."
"Looking ahead, good soil conditions, healthy reservoir levels and a high base means that we expect food inflation to continue slowing over the coming months. And with the economy in a softer patch, underlying price pressures should remain in check."
"With inflation likely to fall a little further, and the central bank's focus shifting to boosting economic growth, more monetary easing lies in store. We expect another 75bps of cuts over the rest of this year, bringing the repo rate down to 5.50%."
RADHIKA RAO, SENIOR ECONOMIST, DBS BANK, SINGAPORE
"Softening inflation prints back the central bank MPC's (Monetary Policy Committee) move to lower rates earlier in the month, with headline prints expected to head to and below the midpoint of the target over the next 2-3 months."
"Monetary policy is expected to be focused on the domestic growth-inflation trade-off at this juncture, whilst addressing rupee depreciation risks via intervention efforts."
DIPANWITA MAZUMDAR, ECONOMIST, BANK OF BARODA, MUMBAI
"The softening of CPI is welcoming from a policy standpoint when global uncertainty is at play. The downward correction is supported by food and rangebound commodity prices."
"Going forward, better arrival statistics of vegetables, generous Rabi harvest and government efforts directed at efficient food supply management will further provide breather for RBI."
"However, risks emerge from imported inflation and bottoming out of commodity price cycle."
UPASNA BHARDWAJ, CHIEF ECONOMIST, KOTAK MAHINDRA BANK, MUMBAI
"January CPI inflation moderated sharper than expected, led by significant easing of food prices. Meanwhile, core inflation inched up a bit to 3.7%."
"Overall, we expect the inflation trajectory to remain benign in the months ahead to provide room for another 25 basis points of rate cut by the MPC. However, the pace of rupee depreciation will need to be closely watched for spillovers on domestic inflation."
KANIKA PASRICHA, ECONOMIST, UNION BANK OF INDIA, MUMBAI
"Veggies have played a significant role with CPI ex-veggies staying nearly flat at 3.8% even as core inflation inched up slightly to 3.66%. On balance, we believe there are downside risks to the MPC's 4.4% CPI projection for Q4FY25 and maintain a 25 basis point rate cut view for April."
