Many economists believe that India’s retail inflation is likely to ease to the Reserve Bank of India’s (RBI) target of 4% in May. This follows the recent data released by the Ministry of Statistics that showed that retail inflation rose to 5.52% in April, the highest in more than three years.
The main drivers of the inflationary pressure are the continued rise in food prices and the government’s efforts to control the prices of essential commodities. However, economists believe that the inflationary pressure is likely to ease in the coming months due to the expected bumper harvest of summer-sown crops, the impact of the new farm laws, and the easing of the lockdown restrictions.
Furthermore, the RBI is likely to keep the key policy rate unchanged at 4% in its June policy review, which is expected to keep inflationary pressures in check. Overall, economists believe that retail inflation is likely to come down to the RBI’s target of 4% in May, barring any unforeseen factors.
