Lower food prices eased India's February 2019 retail inflation to 2.57 per cent, while a sharp decline in manufacturing output slowed industrial production in January to 1.7 per cent, official data showed on Tuesday. Policy makers will release updated quarterly projections for interest rates as well as inflation, growth and employment when they gather next week.
It said that rate of retail inflation, as represented by Consumer Price Index (CPI) for the month of February was 2.57, as against 1.97 per cent in January. Economists had predicted consumer price index at 2.43 per cent for February, according to a poll by Reuters.
According to the Central Statistics Office data, the CFPI had deflated by (-) 2.24 per cent in January 2019. "Core inflation slowed, but is running at a 2.1% annualized pace over the past three months and on a year-over-year basis, close to the FOMC's goal".
Price pressures in the core (excluding food and energy) were a little softer than expected, up only 0.1% in February.
One area where inflation did pick up was food prices, which rose 0.4% on the month.
Industrial growth slows down to 1.7%, retail inflation rises to four-month high
In the 12 months through February, the core CPI rose 2.1%. The CPI increased 1.6 percent on a year-on-year basis in January. Core CPI is anticipated to have jumped 0.2% from last month and 2.2% from previous year, according to economists polled by Bloomberg.
However the average workweek declined in February, given a 0.3% drop in average weekly hours.
A New York Fed survey of consumer expectations published on Monday showed a drop in inflation expectations in February. This marks the strongest inflation-adjusted wage growth since November 2015, an increase that would likely help consumer spending and economic growth.
In a wide-ranging interview with CBS's 60 Minutes television news programme, Fed chair Jerome Powell on Sunday reiterated the central bank's wait-and-see approach to further monetary policy tightening in 2019. The so-called core CPI had increased by 0.2 percent for five straight months.
In contrast, output of consumer non-durables rose by 3.8 per cent and that of consumer durables by 1.8 per cent. Consumers paid more for motor vehicle insurance, airline fares, household furnishings and personal care products.
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