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India CPI Inflation 4.75% y-o-y (consensus 4.9%) in May-24

- India’s CPI inflation for May 2024 stood at 4.75% y-o-y, below the consensus forecast of 4.9%, marking the lowest growth since May 2023.
- Slowing CPI inflation and subdued wholesale price movements, particularly in the manufacturing sector, suggest a potential easing of inflationary pressures, offering economic relief and implications for monetary policy adjustments.

India CPI Inflation 4.83% y-o-y (consensus 4.8%) in Apr-24

- India's CPI inflation in April 2024 was broadly in line with expectations and the previous month at 4.83% y-o-y.
- However, this growth represents the lowest inflation rate since May 2023 and is below both the one-year average and long-run average, which could have significant implications for economic policies and decision-making.

India Policy Rate 6.5% (consensus 6.5%) in Feb-24

• The Reserve Bank of India (RBI) has opted to maintain the Policy Rate at 6.5%, in line with economic forecasts, signalling a cautious approach to balancing growth and inflation within its target range.
• Despite a recent uptick in inflation, the MPC's decision reflects confidence in the underlying strength of the domestic economy and the effectiveness of previous monetary policy adjustments.
• Future policy decisions on interest rates will hinge on inflation trends, the impact of global economic developments, and ensuring the transmission of monetary policy while supporting sustainable economic growth.

Four Important EM Elections in 2024

• Elections in Indonesia and India should both result in policy continuity as far as the economy is concerned. In South Africa, the election outcome will likely lead to a further deterioration in governance. As for Mexico, MORENA will probably retain the presidency but fall short of its target two-thirds majority in the legislature.

By Alastair Newton