Consumer inflation rate forecast to edge up in March

BANGALORE Thu Apr 10, 2014 9:56am IST

A labourer carries a sack filled with cabbage to load it onto a supply van at a vegetable wholesale market in Chennai February 14, 2014. REUTERS/Babu/Files

A labourer carries a sack filled with cabbage to load it onto a supply van at a vegetable wholesale market in Chennai February 14, 2014.

Credit: Reuters/Babu/Files

Related Topics

BANGALORE (Reuters) - India's consumer inflation rate is forecast to have edged up slightly in March due to higher food prices, and factory output in February is expected to have risen at its fastest annual pace in five months, a Reuters poll shows.

The data comes as voting gets underway in India's general election. Opinion polls show the ruling Congress party is set to lose office, with poor economic growth and persistent high inflation important factors in voter discontent.

The Reuters poll found consumer price and wholesale price measures of inflation are expected to rise, but not by enough to prompt a policy response from the Reserve Bank of India.

Industrial output was forecast to have expanded 0.9 percent in February from a year earlier, driven mainly by core industries responding to improved consumer demand.

If the forecast is realised, it would be the strongest growth since September. Output edged up an annual 0.1 percent in January, and fell in each of the previous three months.

The government will release the output data on Friday.

Data last month showed infrastructure output rose an annual 4.5 percent in February, the fastest in five months. That data covers eight core industries which account for more than a third of overall factory production.

"The core industrial growth has remained in the positive growth zone for four consecutive months now and is slowly gaining strength," said Rupa Rege Nitsure, economist at Bank of Baroda.

STICKY PRICES

Annual retail price inflation is forecast to have edged up to 8.19 percent last month, after slowing to 8.10 percent in February.

Core retail price inflation has been sticky at around 8 percent, a level deemed uncomfortably high by RBI Governor Raghuram Rajan.

Wholesale prices are seen rising 5.30 percent in March from a year earlier, up from a 4.68 percent rise in February.

The CPI and WPI data will be released on April 15.

"There was a marginal pick-up in food prices and that will probably be reflected on overall inflation," said Upasna Bhardwaj, economist at ING Vysya Bank.

The RBI has raised interest rates three times since September to try to rein in inflation, even as growth has struggled. It kept policy on hold at a meeting earlier this month.

(Reporting by Rahul Karunakar; Polling by Swati Chaturvedi and Shaloo Shrivastava; Editing by John Mair)

FILED UNDER:

Reforms Push

REUTERS SHOWCASE

Reuters Exclusive

Reuters Exclusive

India looks to sway Americans with nuclear power insurance plan  Full Article 

To Boost Growth

To Boost Growth

Crank up public spending to revive growth - chief economic adviser.   Full Article 

Bold Steps

Bold Steps

SpiceJet rescue plan marks bold bet on Indian aviation recovery.   Full Article 

New Airline

New Airline

Tata, Singapore Air venture Vistara to take off on Jan 9.  Full Article 

Online Sales

Online Sales

Knock knock. Who's there? Amazon's best-selling holiday author.  Full Article 

26/11 Plotter

26/11 Plotter

Pakistan to challenge bail for Mumbai attack "mastermind".  Full Article 

Chinese Economy

Chinese Economy

China revises up size of 2013 economy, sees no effect on 2014 growth.  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage