April retail inflation quickens to 4.58%

Snapping a three-month streak of easing, retail inflation for April accelerated to 4.58% on the back of quickening core inflation. Separate data showed that inflation at the wholesale level accelerated sharply to 3.18% in April, driven by a surge in fuel prices and a rebound in food price inflation.

Growth in the consumer price index (CPI) quickened in April following three months of easing inflation during which growth in the index had slowed to 4.28% in March, the lowest it had been since October 2017. Within the Index, growth in the food and beverages segment slowed marginally to 3% in April from 3.08% in March. Similarly, the fuel and light segment saw growth slowing to 5.24% from 5.73% over the same period.

The hike was largely driven by an upswing in core inflation, especially with a broad-based increase in services segment while marginal upside movements were seen in clothing and housing segments as well. Inflation in the housing segment quickened to 8.5% in April from 8.31% in the previous month, while the clothing and footwear segment saw inflation accelerating to 5.11% from 4.91.

The index for crude petroleum rose by only about 1% to 73.9 in April 2018 from the revised 72.6 in February 2018, despite the around 10% rise in the price of the Indian crude oil basket in INR terms to about ₹4,513/barrel in April 2018 from about ₹4,084/barrel in February 2018. Accordingly, the inflation for this sub-sector may subsequently be revised upward.

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