India's May retail inflation reaches record low of 2.18%
India's retail inflation, or consumer price index (CPI) reached new lows in the month of May 2017 to stand at 2.18% as against 5.76% in May of 2016.
This is the lowest recorded retail inflation since 2012 and remains below Reserve Bank of India's (RBI) medium term threshold of 4%.
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Data compiled by Ministry of Statistics and Programme Implementation (MoSPI) show that consumer food price index (CFPI) went into the negative territory to stand at -1.05% in May 2017 as against 7.47% in May 2016.
Rural CFPI stood at -0.60% and urban CFPI stood at -1.85%.
Retail inflation or CPI for April 2017 was at 2.99%.
A Reuters poll of 25 economists expected retail inflation for May 2017 to ease to 2.60% on the back of falling food and perishable goods prices.
A good June-September monsoon, which delivers about 70 percent of India's annual rainfall, will help drive higher food and grain production, keeping food inflation in check.
Earlier this month, RBI kept its benchmark repo rate unchanged whle softening its hawkish stance following a drop in consumer inflation.
The central bank lowered its headline inflation forecasts to a range of 2.0-3.5% for the first half of fiscal year 2017/18 and 3.5-4.5% in the second half, down from 4.5% and 5%, respectively.
(With Reuters inputs)
Read Zeebiz.com's full coverage on retail inflation here.