Retail inflation eases to one-year low of 3.3% in October on fall in food prices; IIP growth rises 4.5% in September

Retail inflation fell to a one-year low of 3.31 percent in October on the back of cheaper kitchen staples, fruits and protein-rich items, official data released on Monday showed.

The inflation based on the Consumer Price Index (CPI) was 3.7 percent in September 2018 and 3.58 percent in October 2017. The retail inflation number is the lowest since September 2017 when it touched 3.28 percent.

Analysts polled by Reuters had forecast October’s annual increase in the consumer price index at 3.67 percent, compared with a downwardly revised 3.70 percent in September.

The rate of price rise in the food basket contracted by 0.86 percent in October compared to 0.51 percent rise in September, according to the Central Statistics Office data.

Representational image.. AFP.

Representational image.. AFP.

Vegetable prices declined by 8.06 percent in October against a 4.15 percent contraction in September.

Inflation also slowed to 0.35 percent in the fruit basket as against 1.12 percent recorded a month ago.

The retail inflation also cooled in protein-rich items like cereals, eggs, milk and related products.

However, inflation quickened to 8.55 percent for the 'fuel and light' category against 8.47 percent in the previous month.

IIP growth rises at 4.5 percent in September

Meanwhile, industrial production grew at the slowest pace in four months at 4.5 percent in September mainly due to poor performance of mining sector and lower offtake of capital goods.

This was a tad lower than an upwardly revised 4.7 percent year-on-year increase in August, the data showed.

However, the figure was slightly better than a forecast of 4.3 percent growth in a Reuters poll of economists.

The industrial production measured in terms of Index of Industrial Production (IIP) was 4.1 percent in September 2017.

The IIP was recorded at 6.9 percent and 6.5 percent in June and July this year, respectively. The previous low was recorded at 3.8 percent in May this year.

The mining sector output growth decelerated to 0.2 percent in September as against 7.6 percent in the year-ago month. Similarly, capital goods output growth slowed to 5.8 percent in the month under review from 8.7 percent a year ago.

However, the data showed that the manufacturing sector recorded a growth of 4.6 percent in September, up from 3.8 percent a year ago.

The electricity generation too improved to 8.2 percent in the month from 3.4 percent in September 2017.

For April-September 2018, the IIP growth came in at 5.1 percent. The factory output rise was 2.6 percent in same period of the last fiscal.

As per use-based classification, the growth rates in September 2018 over September 2017 are 2.6 percent in primary goods, 1.4 percent in intermediate goods and 9.5 percent in infrastructure/construction goods. The consumer durables and consumer non-durables have recorded growth of 5.2 percent and 6.1 percent, respectively.

In terms of industries, 17 out of 23 industry groups in manufacturing sector have shown positive growth during September 2018 as compared to the corresponding month of the previous year.

The industry group 'manufacture of furniture' has shown the highest positive growth of 32.8 percent followed by 20.9 percent in 'manufacture of wearing apparel' and 20.6 percent in 'manufacture of wood and products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials'.

On the other hand, the industry group 'printing and reproduction of recorded media' have shown the highest negative growth of (-) 12.9 percent followed by (-) 10.7 percent in 'other manufacturing' and (-) 7.3 percent in 'manufacture of tobacco products'.

(with inputs from agencies)


Updated Date: Nov 12, 2018 18:24 PM

Also See