CPI Inflation Reversed To Higher-Than- Expected 7.0% In August: ICRA
CPI Inflation Reversed To Higher-Than Expected 7.0% In Aug, Boosting Likelihood Of 50 Bps Rate Hike In Sep: ICRA
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ICRA Research Report
On an adverse base, the headline consumer price index inflation hardened to a higher-than-expected 7.0% in August 2022 (our expectation: up 6.9%) on a YoY basis from the five-month low of 6.7% recorded in July 2022.
The sequential hardening in inflation was largely driven by broad-based rise across the food segment, with a higher inflation in cereals, pulses, milk, fruits, veggies and prepared meals, snacks, etc.
Moreover, the miscellaneous and housing segments witnessed a marginal rise in inflation in August 2022, partly reflecting the strength of the recovery in the services sector.
We expect the CPI inflation print to rise slightly to 7.1% in September 2022, implying a marginal undershooting in Q2 FY23 vis-a-vis the Monetary Policy Committee’s projection of 7.1% for the quarter.
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