According to ING economists Deepali Bhargava and Lynn Song, India’s consumer price inflation is projected to edge up to 4.2% year-on-year in June, while wholesale price inflation is expected to moderate to 9% [1]. The economists note that softer Brent crude prices should help lower wholesale costs; however, persistent retail fuel prices, gradually firming food inflation, and sticky core inflation pressures are likely to keep overall inflation risks skewed to the upside in the coming months [1].
The ING team highlights that the gradual pass-through of wholesale price changes to retail prices is expected to support underlying inflation pressures [1]. Additionally, they caution that El Niño-related weather disruptions could further threaten food costs, exacerbating inflation risks [1].
No specific market reactions or analyst opinions beyond the ING economists’ projections are mentioned in the article. The report does not provide details on central bank responses, policy changes, or impacts on specific equities or sectors [1].
CONCLUSION
ING economists project a mild uptick in India’s consumer inflation to 4.2% in June, with wholesale inflation moderating to 9%. Despite some easing in wholesale costs, persistent pressures in retail fuel and food prices, along with weather-related risks, keep inflation risks tilted to the upside.