NEW DELHI (Reuters) – A decline in international crude oil prices will help control India’s inflationary pressures going forward, the country’s finance ministry said in a report on Tuesday.
India’s retail inflation eased in October to a four-month low of 4.87%, edging closer to the central bank’s target of 4%.
India’s crude oil basket has averaged $83.93 a barrel in November so far, compared with $90.08 a barrel in October, government data shows.
“The decline in international crude oil prices and continued moderation in core inflation are likely to control inflationary pressures going forward,” the monthly economic report said.
It said core inflation, which strips out volatile food and energy prices, fell to 4.3% in October from 4.5% in September.
The monthly report said that the Reserve Bank of India, which has kept rates on pause for the fourth consecutive policy meeting, has indicated that any further tightening of monetary policy will only occur “if the situation warrants.”
However, food inflation has remained elevated, worrying policy makers, and both finance ministry officials and RBI governor have highlighted risks from a spike in food prices.
(Reporting by Shivam Patel; Editing by Ed Osmond and Alexander Smith)
