• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
  • Editorial Calendar 19-20
BW Businessworld

Feb Inflation at 10.91%; Jan IIP Grows 2.4%

Photo Credit :

India's annual consumer price inflation accelerated to 10.91 per cent in February from the previous month, government data showed on Tuesday, 12 March, 2013. Consumer prices rose an annual 10.79 per cent in January. India's retail inflation is the highest among the BRICS group of emerging economies - Brazil, Russia, China, and South Africa. Food prices for consumers rose 13.73 per cent in February from 13.36 per cent in January.

Meanwhile, industrial production grew 2.4 per cent in January from a year earlier, government data showed on Tuesday. Analysts polled by Reuters had expected the output to grow 1.2 per cent annually. Revised data for December showed production at factories, mines and utilities shrank 0.5 per cent compared with 0.6 per cent contraction earlier. Manufacturing, which constitutes about 76 per cent of industrial production, grew 2.7 per cent from a year earlier, the federal statistics office said. In the April-January period, industrial production expanded an annual 1.0 per cent.

"It's a tale of two diverse numbers, says Shubhada Rao, chief economist, YES Bank, Mumbai "IIP has come in much higher than anticipated which is a positive news, but is a short-lived relief as the CPI came in significantly higher and the concern on food continues."

"Food inflation has gone up 0.78 per cent month-on-month and more importantly, the RBI has been tracking the core CPI, which too has moved up 0.61 per cent after a brief respite. Core CPI is a concern. On IIP, our full year forecast is 1.5-2.0 per cent, but the larger focus in terms of the monetary policy takeaway would be CPI. It would weigh on policy concerns. However, as of now we retain our call of 25 basis points of rate cut on Tuesday."