April IIP at 4.9%, CPI inflation in May rises to 4.87%

New Delhi: Factory output measured in terms of Index of Industrial Production (IIP) grew by 4.9 percent in April, while retail inflation inched up in May to 4.87 percent, government data showed on Tuesday.

Consumer price inflation, which the Reserve Bank of India (RBI) targets in setting interest rates, accelerated to a four-month high of 4.87 percent in May, government data showed on Tuesday, driven by higher fuel prices and a depreciating rupee.

In terms of industries, sixteen out of the twenty three industry groups in the manufacturing sector have shown positive growth during the month of April 2018 as compared to the corresponding month of the previous year, government data showed.

Manufacturing sector, which constitutes over 77 percent of the index, grew at 5.2 percent in April as compared to 4.5 percent in the same month a year ago.

The output of mining sector acelerated to  5.1 percent during the month as compared to  2.3 percent in March 2017. Power generation decelerated to 2.1 percent as against  5.4 percent in March 2017.

In March Industrial output grew by 4.4 percent the slowest in five months, due to a fall in capital goods production and deceleration in mining activity, according to the official data.

The Reserve Bank of India (RBI) last week raised its benchmark interest rate for the first time since 2014, by 25 basis points to 6.25 percent, citing inflation concerns.

The RBI revised up its inflation forecast to 4.7 percent for the second half of the fiscal year ending in March 2019, from the 4.4 percent it projected earlier.