NEW DELHI: India’s consumer inflation likely accelerated slightly in April due to higher food prices, a survey shows. The consumer-price index is expected to have risen 5.0% from a year earlier, according to the median estimate of 17 economists polled by The Wall Street Journal. It climbed 4.83% in March.
“Soft oil prices will keep retail inflation in check, although price pressures could emerge from food items such as sugar and pulses,” D.K. Pant, chief economist at India Ratings and Research, said in a research note. Expectations of lower sugar production this year have led to a bounce back in domestic prices of the sweetener which fell to seven-year lows last year, while supply shortages have pushed up prices of lentils.
Economists say salary increases for government employees and any rebound in crude-oil prices pose a risk to the Reserve Bank of India’s 5% inflation target for March 2017. A good monsoon could, however, help cool food prices by increasing farm output. Weather agencies have forecast India will receive above-average rainfall this year. Meanwhile, India’s wholesale-price index is expected to decline for the 18th month in a row in April due to lower prices of oil when compared with last year’s levels.
Wholesale prices likely declined 0.3% from a year earlier, the median estimate of 15 economists polled showed. That would be smaller than the 0.85% fall in March. The government will announce the consumer prices data Thursday and wholesale prices data Monday.
