Live news , top stories, corporate news, company news, sector news, economy news, results analysis news, ceo interviews, fund manager interview, advisor interview, market news, bazaar talk, hot stocks news, ipo news, commodities news, mutual fund news, insurance news, news wire
24 October, 2014 13:14 IST
News
RBI might bring forward a cut in Dec 18 meeting: Sonal Varma
Source: IRIS | 15 Nov, 2012, 10.14AM
Comments  |  Post Comment

WPI inflation moderated to 7.45% y-o-y in October from 7.81% in September, sharply below expectations, as lower agri-commodity prices and Rupee appreciation offset the impact of higher diesel prices.

Food inflation eased to 7.7% y-o-y in October from 8.5% in September due to lower prices of pulses, fruits and edible oil. More importantly, core inflation also eased to 5.2% y-o-y in October from 5.6% in September, largely driven by a sharp fall in basic metals prices and a stable inflation rate in most other categories.

Meanwhile, even as the full pass-through of the diesel price hike was incorporated this month, this did not translate into higher fuel inflation as prices of non-regulated fuel items such as aviation fuel and bitumen fell sharply. Elsewhere, August WPI inflation was revised up to 8.01% from 7.55%.

``Inflation data comes as a positive surprise and is consistent with the sharp fall in the output price index of the manufacturing PMI to a near two-year low in October. This PMI suggested that the pass-through of past imported cost increases had largely occurred,``  said Sonal Varma, economist, Nomura.

``Lately rupee has started to depreciate again, which signals that the pace of moderation may not be as steep in future. We expect core inflation to moderate further on a year-on-year basis due to base effects and lower cost pressures at the margin. Overall, inflation data suggest a considerable loss in inflation momentum and that the Reserve Bank of India`s (RBI) and our projection of 7.5% headline WPI inflation by March 2013 is very realistic, with some downside risks now,`` Varma opined.

``We continue to expect 50 bps worth of repo rate cuts in H1 2013, with the first coming in January, in line with the RBI's stated forward guidance. However, with inflation clearly below the RBI's stated trajectory, there is a chance that the RBI might bring forward a cut to the December 18 meeting. For now, we are stick to our base case view of a rate cut in January,`` Varma said.


News
Tinplate Company of India standalone quarterly profit falls 29.06% - 22-Oct-2014 19:24
Kansai Nerolac Paints standalone quarterly net surges 40.62% - 22-Oct-2014 19:20
T E C I L Chemical & Hydro Power loss widens in Jul-Sep quarter - 22-Oct-2014 18:09
Transwarranty Finance consolidated quarterly net soars 2.66 times - 22-Oct-2014 18:03
Wipro consolidated Q2 profit rises 8% - 22-Oct-2014 16:46
SBI launches mPassBook facility in 'State Bank Anywhere' smart phone application - 22-Oct-2014 16:37
BSE inks strategic pact with Yes Bank - 22-Oct-2014 16:23
FIIs hike stake in Hindustan Zinc, DIIs cut exposure - 22-Oct-2014 16:07
DIIs increase stake in Unitech in September quarter - 22-Oct-2014 16:05
Zensar Technologies allots 1,560 equity shares - 22-Oct-2014 16:02
Tata Metaliks swings to consolidated profit in Jul-Sep quarter - 22-Oct-2014 15:59
more...
* Q - Quote , N - News , C - Chart , F - Financials
Comments Post comment 
 Post Comment
Name Email
Comment
Security Code type   w23g7w into this box
Home  |   Shares  |   F&O  |   Mutual Funds  |   Loans  |   Insurance  |   News Centre
Wealth Tracker  |   Newsletters  |   Tax Corner  |   NRI Centre  |   Advertise
© All rights reserved. IRIS Business Services Limited
A Disclaimer