Mumbai: India's annual consumer price inflation edged up to a slightly stronger-than-expected 5.77 per cent in June, mainly driven by higher food prices compared with 5.76 per cent in May, government data showed on Tuesday.
Separately, data showed India's industrial output unexpectedly rose 1.2 per cent in May from a year earlier, led by a pick-up in manufacturing.
Economists surveyed by Reuters had forecast a 0.4 per cent fall in the output compared with a provisional 0.8 per cent year-on-year fall in April.
COMMENTARY
Madhavi Arora, economist, Kotak Mahindra Bank, Mumbai:
"The major contributor (to inflation) continues to be vegetable inflation and within vegetables the key components being tomatoes, potatoes etc. Pulses actually have softened on a month-on-month basis, which is a good thing."
"If you look at the trajectory going ahead I think probably August onwards you should start seeing some trending down of the inflation trajectory in general. At this point in time it seems that you would see a comfortable, close to 5 per cent number that RBI is targeting for January."
"We continue to see RBI to be able to be accommodative and at least be able to give one more rate cut in the current fiscal year."
A Prasanna, economist, ICICI Securities Primary Dealership Ltd, Mumbai:
"CPI inflation is slightly higher than expectation driven by food prices."
"However core inflation has softened a tad more to 4.52 per cent from our anticipated 4.60 per cent. This is a mildly positive data to the extent that it is driven by mainly food prices."
"However, it will take a few more months before CPI peaks out. As such our expectation is for RBI to maintain status quo on rates given 5 per cent CPI target for March 2017.
"Having said that clarity on the next RBI governor and composition of monetary policy committee would have a significant bearing on how monetary policy stance evolves going ahead."
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