China Watch Blog reports that India’s inflation unexpectedly accelerated in April to over 7% as food bills soared, data showed on Monday, diminishing chances of swift interest rate cuts to boost a stumbling economy.
The closely watched Wholesale Price Index rose to 7.23% in April from the same month a year ago with food prices climbing more than 10 percent. Inflation stood at 6.89% in March.
The data was the latest grim reminder that Asia’s third-largest economy is facing trouble after figures last week showed industrial output shrank by a surprise 3.5% in March due to weak domestic demand and falling exports.
The inflation number, which far outpaced market expectations of a 6.7% rise, “makes for extremely gloomy reading,” said Credit Suisse economist Robert Prior-Wandesforde.
“India’s growth-inflation mix is not exactly looking favorable right now.”
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