New Delhi: The Retail inflation is likely to average 4.4 per cent this financial year, higher than 3.6 per cent recorded in the previous fiscal year, says a report. Kotak Economic Research has stated that CPI inflation will remain at sub-5 per cent level but uncertainties in domestic as well as global front may potentially impact its course.
The factors that may potentially impact CPI inflation scaling upwards include volatility of global financial markets, fluctuating crude oil prices, MSP pass-through and staggered impact of I-IRA.
Furthermore, alarming depreciation in the value of Indian Rupee may prompt the RBI to retort to unwarranted measures and further rate hikes.
Notably, the Indian rupee on Tuesday tumbled to a record low after hitting the 70-per dollar mark for the first time ever. This comes in the wake of the dwindling value of Turkish Lira and increasing tensions between the USA and Turkey.
The Indian currency slipped to its lowest- as much as 0.2 percent at 70.08 per dollar and is currently among the hardest hit in Asia. The downward dip of the Indian Rupee will make it hard for the Reserve Bank of India to keep inflation in check.
Also Read: Indian Rupee At All Time Low, Hits 70 Per Dollar Mark
Kalinga AI