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India's October retail inflation rises to 6.09%, breaching RBI's 6% ceiling

Food-led price pressures push inflation above the central bank's tolerance limit, raising the prospect of further rate pressure for borrowers and businesses.

Photo: The Indian Express

What happened

India's retail inflation rose to 6.09% in October from 5.54% in September, according to data released by the Ministry of Statistics and Programme Implementation. The Indian Express+4 The reading takes inflation above the Reserve Bank of India's upper tolerance limit of 6%, the first time in two years it has passed that level. The Indian Express+3 Food inflation accelerated to 8.94% in October from 7.74% in September, reflecting broad-based increases in essential food prices. The Economic Times+2 The October reading was also the 12th straight month of rising consumer prices. The Indian Express+1

Around it

Rural inflation was 6.63% compared with 5.41% in urban areas, and rural food inflation reached 9.09%. investingLive Six states recorded inflation above 7%, led by Tamil Nadu at 7.29%, Telangana at 7.26% and Andhra Pradesh at 7.25%. Moneycontrol Onion prices rose 116% in the period, while the data showed a sharp divergence in food prices and household expenses. Moneycontrol Nearly half of economists surveyed by Reuters had expected inflation to reach or exceed the 6% threshold. The Economic Times

What comes next

Pressure is mounting on the RBI to keep raising interest rates, particularly as the economy continues to grow robustly. The Indian Express

Sources

  1. The Indian ExpressRetail inflation crosses RBI’s 6% limit, food inflation at 9%; interest hikes likely
  2. The Economic TimesIndia's October retail inflation quickens to 6.09% to breach RBI's tolerance ceiling
  3. investingLiveIndia October CPI inflation rises to 6.09%, food inflation accelerates to 8.94%
  4. PolymerupdateIndia’s CPI inflation surges to two-year high of 6.09% in October on rising food prices
  5. MoneycontrolInflation breaches RBI's 6% ceiling: Six states cross 7%, onion prices surge 116%- Moneycontrol.com
  6. business-standard.comRetail inflation breaches RBI's 6% upper limit at 2-yr high of 6.09% in Oct

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