Retail inflation inches up in June even as industrial growth slows down in May

-The Hindu Business Line

A surge in the prices of meat, fish and pulses pushed the rate of retail inflation a tad higher to nearly 3.2 per cent in June. Meanwhile, industrial production still seems to be in the slow lane, with 3 per cent growth in May.

Rate cut possibility

These two indicators will play a key role in the monetary policy review to be undertaken by the Monetary Policy Committee (MPC) in the second week of August.

Since the rate of retail inflation is still below the targeted median rate of 4 per cent, and there is need to lower the rate of investment, it is expected that the MPC will go for another rate cut, the fourth successive one this calendar year.

Experts also feel the rate cut this time round could be different from the earlier ones of 25 basis points each.

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The Hindu Business Line, 12 July, 2019, https://www.thehindubusinessline.com/economy/retail-inflation-rises-to-318-in-june/article28412090.ece

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