reported

The bank in a report said that the mild moderation in June CPI inflation was led by sequential moderation in food and core inflation

As consumer price index (CPI) inflation declined for the second straight month, Kotak Mahindra Bank on Wednesday maintained the average CPI inflation estimate at 6.5 per cent for the fiscal year 2023. The bank in a report said that the mild moderation in June CPI inflation was led by sequential moderation in food and core inflation. “We maintain that the return to the sub-6 per cent range will be gradual. We also retain our call of 85 bps of further repo rate hikes by end-3QFY23 (including 35-50 bps in the August policy),” it said in the report. 

The retail Consumer price index (CPI) in India eased to 7.01 per cent in June from 7.04 per cent in May due to a favourable base effect, as per data released by the Ministry of Statistics and Programme Implementation on Tuesday. The data showed that the number is above the Reserve Bank of India’s (RBI’s) tolerance limit for the sixth consecutive month as lower cooking oil prices and fuel offset higher services and food costs. 

The retail inflation rate eased to 7.04 per cent in May from 7.79 per cent in April. The food inflation moderated to 7.7 per cent as compared to May 8 per cent. On a sequential basis, the moderation in food prices was led by a decline in prices of fruits, oils and fats and pulses, the report mentioned. The report further stated that the high frequency prices for July indicate a softening in prices of pulses, edible oils, fruits and vegetables, while cereal prices continue to remain firm.