India’s consumer inflation is expected to have quickened to 4.3% in June, according to a Reuters poll, due to higher food and fuel prices, the U.S.-Iran war, and a weak monsoon.
Inflation Concerns
The expected increase is less a reflection of broad-based inflationary pressures and more a consequence of a gradual firming in food, fuel, and select services categories over recent months, noted Kunal Kundu, India economist at Societe Generale.
Retail fuel prices remained elevated after state-owned fuel retailers raised prices four times in May, increasing transportation and logistics costs. Food price pressures could build further if El Nino disrupts crop production during the June-September season.
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