Retail inflation rises to seven-month high of 3.58% in October


A vendor arranges vegetable at his stall in a market in Mumbai, November 13, 2017.

India's inflation accelerated more-than-expected in October after holding steady in the previous month, preliminary data from the Central Statistics Office showed Monday.

The consumer price index (CPI), a measure of retail inflation, had come in at 3.28% in September.

"A sharp increase of 30 basis points in overall inflation to 3.58 percent on the back of an increase of 50 basis points in food inflation, and an uptick of 80 bps in fuel inflation rules out a remote chance of policy rate cut in December".

Inflation for the month of October stood at 4.20 per cent in 2016.

The data would diminish the odds of further rate cuts by the Reserve Bank of India as inflation nears the central bank's 4% long-term target, making an overshoot likely later this year.

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Consumer food price inflation, a metric to gauge changes in monthly kitchen costs, saw a jump, with prices rising 1.90 percent in October from 1.25 percent in September.

RBI holds a policy review on December 6.

Retail inflation in vegetables nearly doubled to 7.47 per cent in October compared to 3.92 per cent in September.

Despite a cut in taxes, retail petrol prices have gone up by 7.6 percent and diesel by 6.6 percent in New Delhi in the past year.

Prime Minister Narendra Modi, who faces crucial state elections in his home state of Gujarat next month, is under pressure to revive economic growth, which slipped to 5.7 percent in the April-June quarter, the slowest pace in three years.