Is India emerging as one of the bright spots, given the situation worldwide?
While many advanced economies have been grappling with elevated prices for months, consumer price inflation in India dropped to a five-month low in October. Apart from prices of cereals, fruits, and pulses, the changes in most other items in October compared to the same month last year were relatively subdued. In fact, the two items that had previously driven consumer prices up, edible oil and fuel, became cheaper last month, according to the recently released government data.
Here are the key highlights of the data released on Monday:
- Among the larger states, consumer price inflation was higher in nine states, with Odisha reporting the highest rate at 6.47 per cent. Of these nine states, three are governed by the BJP. Rajasthan, Haryana, Gujarat and Telangana are among states with inflation rates higher than the national average.
- When it comes to consumer price inflation in rural areas, seven states reported figures higher than the national average. Two of these states are under BJP rule, as per data released by the National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation. Bihar, Haryana, Jharkhand, and Karnataka are among states with higher rural inflation.
- In Chhattisgarh, Delhi, Madhya Pradesh, Tamil Nadu, and Jammu and Kashmir, the inflation rates are among the lowest, at four per cent or below.
- While the prices of fuel and light and edible oils dropped in October, there was a marginal increase in the prices of vegetables, as well as in transport and communications.
On Sunday, The Economist published an article analyzing the inflation trend in developed countries. Their analysis indicates that inflation remains quite entrenched, even more so now than in 2022. The journal concludes that the situation continues to be challenging in the US, Canada, UK, and Australia, with some improvement seen in Italy, Spain, Japan, and South Korea.
Is India emerging as one of the bright spots, given the situation worldwide?
Global investment bank major, Goldman Sachs, recently upgraded India's markets to overweight in an otherwise tricky period in the Asia-Pacific region. This follows earlier upgrades from institutions such as Morgan Stanley, CLSA, and Nomura. The factors driving these upgrades include macroeconomic stability in India, with a subdued inflation trajectory being one of them.