CareEdge analysis on CPI inflation - August 2024 & IIP Report

CPI Highlights:

The CPI inflation inched up marginally to 3.7% in August up from 3.5% in July.
Core inflation remained steady at 3.4% in August.
Food and Beverages inflation rose to 5.3% in August up from 5.1% in the previous month.
If price pressures on food basket moderates, we anticipate that the RBI may initiate a shallow rate cut cycle in the second half of the fiscal year.
For FY25, we expect inflation to average 4.8%.

IIP Highlights:

IIP growth increased to 4.8% in July from 4.7% in the previous month.
Electricity and mining sector output moderated to 7.9% (Vs 8.6%) and 3.7% (Vs 10.3%), respectively.
Manufacturing output increased to 4.6% (Vs 3.2%).
Output of consumer durable goods increased, whereas non-durables output contracted.
Going forward, a sustained and meaningful improvement in consumption and private capex remains critical for IIP.