Retail inflation inched up to a 4-month high in May on the back of strengthening fuel, housing and food prices, while industrial output growth remained steady in April, prompting economists to say that possibility of another rate hike persists for now.
Inflation as measured by the Consumer Price Index rose an annual 4.9% in May compared to the previous month’s 4.6%. Rural inflation stood at 4.9%, while urban inflation was at 4.7%.
Fuel and light inflation rose 5.8% in May, while housing prices shot up 8.4% during the month. Fruit prices rose an annual 12.3%. Pulses and product prices contracted 11.6% in May.
Industrial output rose an annual 4.9% in April compared to 3.2% in the year-ago period. Manufacturing, which accounts for over 75% of the index, rose a healthy 5.2% in April compared to a 3% expansion in the year earlier period. Capital goods, a key gauge of industrial activity, rose 13% in April compared with a decline of 4.8% during the same month last year.