Perspective on CPI & IIP Data by Mr Nish Bhatt, Founder & CEO, Millwood Kane International
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It's good news on both fronts. Retail inflation for the month of November has eased to 5.48% vs. 6.21% in October. The overall basket has seen easing, with food inflation easing to 9.04% vs. 10.87% (MoM). Core inflation stood at 3.7%, well below the RBI's targeted range of 4-6%.
On the industrial production front, October IIP data grew at 3.5% vs 3.1% (MoM), and mining and manufacturing grew at 0.9% and 4.1% respectively. While the street was expecting a rate cut in December, the RBI kept rates unchanged, citing high inflation, the latest inflation data will help ease interest rates when the MPC meets next in February. We expect the RBI to ease rates by 50 bps in CY25. As we advance, geopolitical tensions, its impact on crude, and any new trade tariffs imposed by the incoming government in the US.
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