India’s inflation rose faster-than-expected to 7.23 percent in April as compared to 6.89 percent in the previous month, mainly driven by a sharp increase in the prices of food items and manufactured products, government data showed Monday.
In the monthly report, the commerce and industry ministry revised upward February inflation figure to 7.36 percent as compared 6.95 percent reported earlier.
The monthly data showed that inflationary pressure continued in the system, limiting the room for further rate cut by the central bank.
Food inflation surged into double-digit. Food inflation rose to 10.49 percent in April as compared to 9.94 percent in the previous month as vegetables, pulses, milk, egg, meat and fish became costlier, pinching the pockets of common people.
Prices of vegetables surged by 60.97 percent year-on-year. Potato price more than doubled. Milk became costlier by 15.51 percent. Prices of egg, meat and fish rose by 17.54 percent. Pulses became costlier by 11.29 percent.
Price of manufactured products increased by 5.12 percent year-on-year, while price of fuel and power grew by 11.03 percent.
The recent data showed that India continued to face the problem of high inflationary pressure and low growth.
As per the data released by the Central Statistics Office last week, India’s industrial output shrank by 3.5 percent in March due to poor show of manufacturing and mining sectors. It was is the first contraction in the factory output since October 2011, when it shrank by 4.7 percent.
The factory output, measured in terms of the Index of Industrial Production (IIP), had registered a growth of 4.1 percent in February year-on-year.
Taking cues from the moderation in inflation, the Reserve Bank of India (RBI) in its annual monetary policy for 2012-13, announced April 17, lowered the key policy rates by 0.50 percent for the first time in three years.