Retail inflation softens to 4.4 pct for Feb

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Consumer price inflation (CPI) was at 5.07% in January.

The Index of Industrial Production (IIP) had grown at 7.1 percent in December 2017, according to the data released by the Central Statistics Office (CSO) today.

Consumer food price inflation, a metric to gauge changes in monthly kitchen costs, fell to 3.38 percent in February as compared with a 4.58 percent growth in January.

The cumulative growth in these three sectors during April 2017-January 2018 stood at 2.5%, 4.3%, and 5.3%, respectively.

Meanwhile, the industrial output grew by 7.5% in January.

The IIP growth in January this year was mainly on account of uptick in manufacturing sector, which constitutes of 77.63 per cent of the index.

The retail inflation, however, fell to four-month low of 4.44 per cent in the month of February as compared to 5.07 per cent in January. However, the inflation moved up for pulses and products (-) 17.35% and spices (-) 1.01% in February 2018. In terms of actual outcomes, headline inflation averaged 4.6% in Q3, driven primarily by an unusual pick-up in food prices in November. In all 16 out of 23 industry groups in the manufacturing sector showed growth in January. "Domestic pump prices of petrol and diesel rose sharply in January, reflecting lagged pass-through of the past increases in global crude oil prices".

However, Assocham Secretary General D S Rawat said it would be safe to assume that a lot of advantage has accrued because of the low base effect of the previous year when the growth had plunged following demonetisation.

The data come soon after the second advance estimate of GDP, which revised upwards the growth prospects for the fiscal to 6.6 per cent from the previous projection of 6.5 per cent.

Deloitte India Lead Economist Anis Chakravarty said: "Overall, the latest IIP data points towards signs of economic recovery as the negative effect of the disruptive shocks of a year ago appear to be on the wane".