India April inflation rises for sixth straight month, below estimates

India’s consumer price inflation in April rose to 3.48% for the sixth consecutive month, from 3.40% in March, despite government disapproval. Keeps prices at the pump constant To protect consumers from rising global oil prices.

The headline inflation figure was below economists’ expectations of a 3.80% increase in the consumer price index, according to a Reuters survey.

India’s Ministry of Statistics and Program Implementation announced that food inflation, a key component of the country’s consumer price index, rose to 4.2% from 3.87% in March. he said in a broadcast.

The latest inflation reading may be less important than its trajectory, Duvvuri Subbarao, former governor of the Reserve Bank of India, told CNBC’s Inside India on Tuesday.

“If inflation continues long enough, inflation expectations will harden and turn what is today a supply shock into a demand shock,” he said. Subbarao added that this would be “particularly worrisome for the RBI”.

India, the world’s fastest-growing major economy, is among the countries most vulnerable to supply disruptions caused by the Iran war. The South Asian country imports about 85% of its fuel needs and relies on the Strait of Hormuz for about 50% of its crude imports, 60% of its liquefied natural gas and almost all of its liquefied petroleum gas supplies.

In his monetary policy statement last month, India’s central bank governor Sanjay Malhotra warned that the intensity and duration of the conflict in the Middle East, as well as the damage it inflicts on energy and other infrastructure, pose “risks to inflation and growth prospects.”

The Reserve Bank of India also reduced India’s real gross domestic product growth forecast from 6.9% to 6.8% for the April-June quarter and from 7.0% to 6.7% for the July-September quarter, citing the impact of the Iran war on the economy.

It forecasts headline inflation for the fiscal year ending March 2027 to be: be around 4.6%.

While the government has so far refrained from increasing fuel prices and only marginally increased cooking gas prices, a persistent rise in global fuel prices could increase the risk of a price hike, according to Crisil, an Indian research and credit rating firm owned by S&P Global.

Signs of increasing pressure on the economy are already emerging. Indian Prime Minister Narendra Modi on Sunday to protect foreign exchange reserves He called on citizens to restrict fuel consumption, reduce foreign travel and stop gold purchases due to rising global prices.