India's CPI Inflation Eases To 12-Month Low of 4.75% In May 2024; IIP Grows 5% In April

Retail Inflation in May 2024: India’s CPI inflation in May 2024 eased to a 12-month low of 4.75 per cent, according to official data released on Wednesday, June 12. In the previous month of April 2024, India’s retail inflation stood at 4.83 per cent. India’s industrial production, based on IIP, grew 5 per cent in April.

“Year-on-year inflation rate based on all India Consumer Price Index (CPI) number is 4.75% (Provisional) for the month of May 2024. Corresponding inflation rate for rural and urban is 5.28% and 4.15%, respectively,” the Ministry of Statistics and Programme Implementation said in a statement.

The CPI inflation in May 2024 is, however, higher than the 4.31 per cent recorded in the year-ago month of May 2023. It is also the previous low.

Inflation in the food basket was 8.69 per cent in May, marginally down from 8.70 per cent in April, according to the data released by the National Statistical Office (NSO).

Headline inflation has seen sequential moderation since February 2024, albeit in a narrow range from 5.1 per cent in February to 4.8 per cent in April 2024.

The government has tasked the Reserve Bank to ensure the CPI inflation remains at 4 per cent with a margin of 2 per cent on either side.

Earlier this month, the RBI projected the CPI inflation for 2024-25 at 4.5 per cent, with Q1 at 4.9 per cent, Q2 at 3.8 per cent, Q3 at 4.6 per cent, and Q4 at 4.5 per cent.

In its latest monetary policy review, the Reserve Bank of India’s (RBI) monetary policy committee maintained its FY25 inflation projection 4.5 per cent but added that food prices could continue to be sticky.

IIP: India’s Industrial Production Grows 5% in April 2024

According to separate official data released on Wednesday, India’s industrial production grew 5 per cent in April this year mainly due to good show by mining and power sectors.

The factory output measured in terms of the Index of Industrial Production (IIP) witnessed a growth of 4.6 per cent in April 2023. India’s Index of Industrial Production grew by 5 per cent in April 2024, an official statement said.

The data released by the National Statistical Office (NSO) showed that the manufacturing sector’s output grew 3.9 per cent in April 2024 against 5.5 per cent in the year-ago month.

In April this year, mining production rose 6.7 per cent and power output increased 10.2 per cent.