NEW DELHI: India's retail inflation rate hit a six-month high in April, due to bigger increases in food prices, but remained below the Reserve Bank of India's target for a ninth month, keeping hopes alive for a June cut in the key interest rate.
Annual retail inflation in April was 2.92 per cent, up from the provisional 2.86% in the previous month, but slightly below analyst forecasts, government data showed on Monday, reports agencies.Pulses inflation stood at -0.89 per cent versus -2.25% (month on month), reported CNBC TV18. Cereals inflation was 1.17 per cent versus 1.25 per cent (MoM).
The inflation rate has fallen sharply from a peak of more than 12 per cent in November 2013, which Prime Minister Narendra Modi has touted while seeking a second term in general elections that began on April 11. Votes will be counted on May 23.
While low inflation is helping the economy, declining farm incomes and record high unemployment have hit consumer demand and economic growth.
This year, the monetary policy committee of Reserve Bank of India (RBI) has cut its benchmark repo rate twice, reducing it to 6.0% and many economists expect another 25 basis point trim on June 6.