Indian Consumer Inflation Likely Rose to 4.50% in July

Indian consumer inflation likely rose to 4.50% in July, marking the second straight month the figure exceeded the 4% medium-term target set by the Reserve Bank of India. A Reuters poll of 40 economists indicates that uneven rainfall hampered agricultural output, driving up food prices and fueling the increase.

Despite the rise, inflation remained within the central bank's broader 2% to 6% target range. Consequently, the Reserve Bank of India kept interest rates unchanged this week. The bank cited adverse weather and global energy market uncertainty as the primary risks to the inflation outlook.

Kanika Pasricha, Chief Economic Advisor at Union Bank of India, noted that while July monsoon activity improved crop conditions, it did little to ease immediate supply concerns. While the U.S.-Israeli war with Iran has caused volatility in crude oil prices, the lack of recent domestic retail fuel price revisions is expected to limit the impact on consumer inflation. Official data is scheduled for release on August 12.