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 Below the Quote on IIP and CPI Numbers by Mr. Vivek Rathi, Director Research, Knight Frank India

“Consumer headline inflation in Jan’24 ebbed to 5.1% supported by broad based price slowdown across all the categories including the food basket. A slowdown in the inflation eases the price pressure on the household personal consumption expenditure, especially in the lower income category which is more susceptible to increase in prices. Going forward, in the next few months, the inflation is further expected to ease, however the risk to food inflation may remain upwards.

The RBI has projected the consumer headline inflation at 5.4% in FY24 and ease further in the upcoming fiscal year, narrowing down to 4.5% in FY25. If the inflation moves as per projections, it will provide adequate cushioning for the RBI to initiate a rate cut in the second of FY25. Any reduction in the policy rate which would translate into lowering the home loan interest rate in near future will serve as a big boost to homebuyer sentiment and enable better affordability particularly in the lower segment of the market.

The growth indicators from the industrial production print however seems to be uneven. Output from most of the key industries have witnessed moderate growth, however, due to high statistical base. Sequentially, the growth in the output across all the industries has remained strong which is supportive of overall economic growth trajectory.”

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