India’s CPI inflation moved sideways in Feb-24, coming in at 5.09%YoY, almost unchanged from Jan-24.
Download ReportQuantEco Research || Feb-24 CPI inflation - Remains range bound
At 5.09%, CPI inflation stayed rangebound in Feb-24, close to Jan-24 levels and broadly in line with our expectations. Food prices gained momentum (0.16%MoM), defying the seasonality, owing to hardening of Meat & fish and Cereal prices, along with lower than seasonal correction in vegetable prices. Beyond food and fuel, price pressures in core sub-categories remained ranged, pushing the annualized core inflation to 3.3%YoY – a fresh record low in the series. For FY24, CPI remains on track to average at 5.3%, and is expected to glide lower to 4.8% in FY25 as per QuantEco estimates. The anticipated turn of global ENSO conditions to neutral, augurs well for 2024 Southwest monsoon and further abatement of food price pressures. Having said so, we maintain a close watch on spillovers from climate risks as well as escalation in merchandise trade costs post diversion of trade away from Red Sea region across the Cape of Good Hope.