Inflation rate lowers down to 2.18 per cent in May, lowest since 2012

Driven by cooling food prices, India's annual consumer price inflation eased further to 2.18 per cent in May, from 2.99 per cent in April, government data showed on Monday. This is the lowest inflation rate since India started publishing an economy-wide consumer price index in 2012. Retail food prices fell 1.05 percent last month from a year ago, compared with a 0.61 percent gain in April.

Industrial production growth, on the other hand, slipped to 3.1 per cent in April due to poor show by manufacturing, mining and power sectors coupled with lower offtake of capital goods and consumer durables. The factory output measured in terms of the index of industrial production (IIP) had expanded by 6.5 per cent in April last year, the data released by the Central Statistics Office (CSO) today showed.

The CSO also revised upwards the IIP growth figure for March to 3.75 per cent from provisional estimate of 2.7 per cent released last month.

According to the CSO data, manufacturing sector, which constitutes 77.63 per cent of the index, grew at 2.6 per cent in April compared to 5.5 per cent in same month last year.