A Reuters poll of economists had forecast the August IIP at 4.8 percent.
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The consumer price index (CPI) inflation or retail inflation is up at 4.41 per cent in September due to costlier food items in general and beverages and pulses in particular as compared to 3.74 per cent in August, government data released on Monday has showed.
The jump in the index of industrial production (IIP) in the month of August to 6.4 percent from 4.1 percent in the preceding month, with notable improvement in segments such as consumer durables, mining, manufacturing and electricity, confirms the belief that gradual recovery is very much under way in the Indian economy.
However, the rate of price growth for “cereals and products” was faster at 1.38 per cent. As per the data from the Ministry of Statistics and Programme Implementation (MOSPI), inflation in sugar and confectionery category remained in negative zone at (-) 12.91 per cent.
The CPI for September previous year was at 5.63 percent. CPI for rural areas stood at 5.05%, while CPI for urban areas was at 3.61% in September.
India’s factory output as well as retail inflation accelerated in August and September, respectively.
Last week, the Bank of England’s monetary policy committee (MPC) voted to leave interest rates at 0.5 per cent, and delivered a few welcome news for households when it predicted that inflation would remain close to zero for longer, staying below 1 per cent until spring 2016.
Making the fourth cut in interest rates this year, the RBI cut the repo rate, at which it lends to commercial banks, by 50 basis points last month to bring it down to 6.75 percent. “Core inflation moderate”, said chief economic advisor Arvind Subramanian.
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“Despite high pulses inflation, most noteworthy point in today’s inflation number is resilience of food inflation and its ability to withstand adverse weather shock (2014 and 2015 sub-par monsoon)”.
