India inflation rockets to 7.81%
Blame this increase on the mid-September hike in administered fuel prices.
According to Nomura, WPI inflation rose to 7.81% y-o-y in September from 7.55% in August, mainly due to the mid-September hike in administered fuel prices. July WPI was revised up to 7.52% from 6.87%, suggesting price pressures persist.
Here's more from Nomura:
Food inflation eased to 8.5% from 9.1% in August, while core inflation remained unchanged at 5.6%, above its medium-term average.
Today‟s data suggest that while higher fuel prices are the main reason for price pressure, core inflation remains sticky.
Food inflation has remained tame thus far, but we expect food and overall WPI inflation to inch higher in the coming quarter due to the second-round effects of higher diesel prices. As such, we do not expect a repo rate cut on 30 October.
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