In last inflation print before MPC meet, Feb CPI likely near 4% goal

India's consumer price index (CPI)-based retail inflation is likely to have cooled further in February, approaching or falling below the 4 per cent inflation target for the Reserve Bank of India (RBI), due to easing prices across various goods categories, especially food items.

- SHIVA RAJORA

This could open another window for the monetary policy committee (MPC) to consider a repo rate cut in its bi-monthly meeting in April.

In January, retail inflation stood at 4.31 per cent. The statistics ministry will release the February CPI data on Wednesday.

The RBI had projected CPI inflation for the current financial year (2024-25) at 4.8 per cent, with the headline figure for the January-March quarter expected to remain at 4.4 per cent.

Nomura Asia, in a note, said that as vegetable prices are cooling, headline inflation is converging towards core inflation and is tracking at around 4 per cent in February and 4.1 per cent in the March quarter.

"Weak domestic demand, higher crop output, and muted manufacturing costs are likely to offset upside risks from a weak currency," it added.