BENGALURU, Oct 12 (Reuters) - India’s annual retail inflation eased to 4.35% in September from 5.30% in the previous month, government data released on Tuesday showed.
Analysts in a Reuters poll had predicted annual inflation at 4.5%.
"The scale of moderation in the September CPI inflation was along expected lines, providing transient relief. The bulk of the pullback owes to base effects and administrative steps (lower import duties on edible oils etc.), notwithstanding which, core inflation outpaced the headline to stay firm at 5.8% year-over-year."
"We expect the downdrift to last for another couple of months, likely slipping below 4%, before reversing higher."
"Beyond the near-term relief, delayed rains pushing up staples (vegetables), pass-through of high energy/coal prices, rising input prices, service sector reopening pressures, and receding base effects, are likely to buoy headline CPI back above 5.0% yoy in the March 2022 quarter."
GARIMA KAPOOR, ECONOMIST - INSTITUTIONAL EQUITIES, ELARA CAPITAL, MUMBAI
"Supported by high base effect and across the board cooling of food inflation, September inflation print fell below 4.5% for the first time in five months. While the moderation of inflation for September is encouraging, higher energy and elevated vegetable prices in October may lead to a short reversal in trend for food inflation before the seasonal easing kicks in due to Kharif crop arrivals."
"We see risks of sticky core inflation prints through the year amid the pass-through impact of higher energy prices and higher intermediate input prices caused by supply disruptions in China. We expect FY22 CPI inflation at 5.4% with a marginal upside bias." (Reporting by Rama Venkat in Bengaluru; Editing by Aditya Soni)