India’s retail inflation has eased to a 9-month low of 4.85% in March 2024 on an annual basis, said the data released by the Ministry of Statistics & Programme Implementation on Friday.

The inflation also eased in March from February’s 5.09%.

Previously, CPI-based inflation was the lowest at 4.87% in October 2023. Food inflation, measured by the CPI Food index, also cooled, coming in at 8.52 per cent last month as against 8.66 per cent in February.

Volatile food prices have been a key challenge for the government and the central bank, which kept its interest rates unchanged for the seventh consecutive meeting last week and has said it will focus on bringing inflation down to 4%.

As per the MoSPI data, while urban inflation decreased to 4.14% in March from 4.78% in February, rural inflation saw a slight uptick.

Rural inflation inched up to 5.45% compared to 4.34% in February.

Speaking on the inflation data, Madhavi Arora, Lead Economist, Emkay Global said, “The inflation print has been largely in line with market expectations and is unlikely to be a big moving factor in RBI’s reaction function. We have been arguing that the RBi has no macro stability merit in preceding the Fed in rate action and with our base case of no cut by Fed in CY2024, it appears difficult to see the RBI cut repo rate either.”

“However easier banking liquidity conditions in coming months would still keep financial conditions easy despite no policy action,” she added.

At the Monetary Policy Committee (MPC) meeting, the Reserve Bank of India (RBI) Governor Shaktikanta Das said the CPI Inflation for the current year 2024-25 is projected at 4.5%. CPI Inflation for Q1 2024-25 is projected at 4.9%, Q2 at 3.8%, Q3 at 4.6% and Q4 at 4.5%.

The Ministry of Statistics & Programme Implementation also released the Index of Industrial Production (IIP) for February. It showed robust growth, expanding by 5.7% compared to 3.8% in January 2024.

The Quick Estimates of IIP for February stands at 147.2. The IIP for the Mining, Manufacturing and Electricity sectors for the month of February 2024 stand at 139.6, 144.5 and 187.1 respectively.

The indices stand at 148.2 for Primary Goods, 106.2 for Capital Goods, 158.9 for Intermediate Goods and 179.8 for Infrastructure/ Construction Goods for the month of February 2024.

Further, the indices for Consumer durables and Consumer non-durables stand at 121.6 and 148.9 respectively for the month of February 2024.