In a shocker, consumer price index (CPI) inflation touched 6.5 per cent in January, the Ministry of Statistics & Programme Implementation said on Monday, after being 5.72 per cent in December and 5.88 per cent in November last year, and economists termed it "worrisome".
"CPI inflation moved to 6.5 per cent in January is higher than our expectations and is worrisome. Sequentially, inflation has snapped a two-month contractionary streak as food inflation and core inflation remained firm," Rajani Sinha, Chief Economist, CARE Ratings told IANS.
"Today's inflation shocker led by food as well as consistently higher core inflation momentum has depicted we are far from the 'durable disinflation' process," said Madhavi Arora, Lead Economist, Emkay Global Financial Services.
Sinha said while vegetable prices contracted for the third straight month, the momentum was not strong enough to counter the sharp rise in essentials such as cereals, meat, fish, milk, and eggs.
"The contribution of food inflation to overall inflation rose to 44 per cent in January from 37 per cent in December. Meanwhile, core inflation has remained sticky at 6.3 per cent as inflation for housing, personal care and healthcare moved higher," she added.
According to Sinha, going forward, the sticky core inflation will remain a concern though the average CPI inflation is expected to moderate to 5.1 per cent in FY24 on the back of softening prices of cereals and pulses.
The monetary policy tightening so far, and some fizzling of pent-up demand should also help ease CPI inflation.
"This upside inflation surprise comes after RBI revised down its 4QFY23 CPI forecast by 20bps in the last MPC policy. This shows how uncertain the inflation trajectory can get, for even near-term estimates and possibly explains why they maintained the current stance of withdrawal of accommodation to keep policy flexibility ahead," Arora said.
According to her, 4QFY23 inflation may now be possibly 50 bps higher than the RBI's revised estimate and could also force the RBI to further tighten their stance ahead.
"From the policy perspective, we believe that further rate hikes are unlikely. However, we need to be cautious as RBI (Reserve Bank of India) has left the window open for possibility of another rate hike in case of a sustained rise in inflation," Sinha said.
Bhavan’s Little Learners celebrate annual programme
The Bhavan’s Little Learners, Bordowali celebrated annual programme and organised prize distribution ceremony here at Agartala Rabindra Satabarshiki Bhavan on Wednesday.
Govt working to boost agricultural production to make Tripura self-reliant: Minister Ratan Lal Nath
The Tripura government is contemplating to make Tripura self-reliant in agricultural production, said agriculture minister Ratan Lal Nath on Wednesday.
Scholarship Fraud: Tribal Welfare Dept issues show cause to 34 students
In a major crackdown on scholarship fraud, the Tripura Tribal Welfare Department has issued show cause notices to 34 students for allegedly submitting fake income certificates to avail the Scheduled Tribe (ST) Post-Matric Scholarship for the academic year 2023-24.
Fall of Congress in Gujarat: Three decades of decline and struggle for relevance
The Congress party was once the dominant political force in Gujarat, shaping the state’s governance since independence. However, over the past 30 years, the party has witnessed a dramatic downfall, losing ground to the BJP’s aggressive electoral strategies, organisational strength, and ideological appeal.
‘Disempowering Muslims’: J&K political parties oppose Waqf (Amendment) Bill
All political parties of J&K, except the BJP, opposed the Waqf (Amendment) Bill, saying that the Bill is intended to disempower Muslims and only target one religion.
Radical group founder wanted in Jaipur serial blast plot apprehended in Ratlam
The Madhya Pradesh Police in Ratlam achieved a significant breakthrough in apprehending Firoz, also known as Sabji, a fugitive implicated in a conspiracy to execute serial blasts aimed at creating panic and terrorising the Rajasthan capital city of Jaipur.
Amit Shah & Akhilesh Yadav’s lighter exchange in LS over party president
Amid the uproar and heated debate between the ruling party and the Opposition over the Waqf Amendment Bill on Wednesday, the Lok Sabha witnessed some lighter moments between Home Minister Amit Shah and SP President Akhilesh Yadav.
Sensex, Nifty end higher ahead of US reciprocal tariffs announcement
The Indian stock market bounced back on Wednesday, with both the Sensex and Nifty closing higher, just before the reciprocal tariffs deadline set by US President Donald Trump.