India’s inflation accelerated to 4.82% in August
In India, annual consumer price inflation accelerated to 4.82% in August, following 4.45% in July. The indicator rose for the tenth consecutive month and slightly exceeded economists’ expectations: in a Reuters poll, they forecast 4.80%, CNBC Top News reports.
Food and fuel prices
According to India’s Ministry of Statistics and Programme Implementation, food inflation reached 5.95% in August, compared with 5.52% in July. The acceleration in the overall indicator comes amid higher food and fuel prices.
CNBC notes that India imports nearly 85% of the fuel it needs and depends on energy supplies through the Strait of Hormuz. Global oil prices exceeded $100 per barrel and rose on Monday after Saudi Arabia shut down a key east-to-west pipeline due to damage caused by a drone attack.
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Economic forecasts
Despite rising food and fuel prices in recent months, India’s economy grew by 7.8% in the quarter ending in June, exceeding expectations. Morgan Stanley and Citi raised their forecast for the country’s economic growth over the 12 months to March 2027 to 7.3%, from less than 7% previously.
At the same time, HSBC expects growth to slow in the coming quarters. The bank cited a high comparison base, cuts in government capital spending to meet budget deficit targets, and insufficient rainfall affecting the sowing campaign among the reasons.
The Reserve Bank of India forecasts headline inflation at 5% in the financial year ending in March 2027 and core inflation at 4.3%. In August, the central bank left key interest rates unchanged, although a number of other Asian central banks were raising rates due to inflationary pressure.
