With fuel prices at record levels, what can one expect from the consumer price index (CPI) inflation and index of industrial production (IIP) data?
While it is important in terms of data, it is also back-dated because we do have the current situation of the rupee depreciating as well as the fuel or crude prices increasing and hence the fuel prices being at record levels. So while the CPI data will give you a sense in terms of what has taken place in terms of the inflation trajectory in the past, the current scenario might be something that the Reserve Bank of India (RBI) will probably take more into cognisance.
In terms of the August CPI data, it is expected to be a sub 4 percent figure. So 3.67 percent versus 4.17 percent is what CNBC-TV18’s poll is indicating with core CPI seen at 5.9 percent versus around 6.29 percent.
In terms of the IIP data, it is expected to be steady. It is expected to come off that 7 percent figure that we saw in the previous month but for July it is expected at 6.7 percent, range is 6-7.5 percent, some softening is expected but overall it is expected to still be steady because the core sector grew quite steadily at 6.6 percent.