Inflation in India in April rose for the sixth month in a row, below estimates
A customer gives a pineapple to a vendor at a roadside shop decorated with plastic Vishu Konna (scientific name: Cassia fistula) flowers ahead of the Vishu festival in Kochi, India, on April 14, 2026.
Nurphoto Nurphoto Getty Images
India’s consumer price inflation in April rose for the sixth consecutive month to 3.48% from 3.40% in March, as the government kept prices at the tap unchanged to protect consumers from rising global oil prices.
The headline inflation number was below economists’ expectations of a 3.80% rise in the consumer price index, according to a Reuters poll.
Food inflation, a key component of the country’s consumer price index, reached 4.2%, up from 3.87% in March, India’s Statistics and Planning Department said in a statement.
The latest inflation reading may be biased, Duvvuri Subbarao, former governor of the Reserve Bank of India, told CNBC’s Inside India on Tuesday.
“If inflation continues long enough, inflation expectations become hard, and it can turn what’s there today into a demand shock,” he said. That would be “very worrying for the RBI,” Subbarao said.
India, the world’s fastest growing economy, is among the countries most vulnerable to supply disruptions caused by the Iran war. The South Asian country imports about 85% of its fuel needs and relies on the Strait of Hormuz for about 50% of its crude, 60% of its liquefied natural gas, and nearly all of its liquefied petroleum gas.
Last month, in a monetary policy statement, India’s central bank governor Sanjay Malhotra warned that the intensity and duration of the Middle East conflict, as well as the damage it has caused to energy and other infrastructure, poses “risks to inflation and the outlook for growth.”
The Reserve Bank of India also lowered its forecast for real domestic product growth in India for the April-June quarter to 6.8% from 6.9% and for the July-September quarter to 6.7% from 7.0%, citing the impact of the Iran war on the economy.
It estimates headline inflation for the fiscal year ending March 2027 to be around 4.6%.
Pressure to raise prices
Although the government has so far refused to raise fuel prices and cooking fuel prices have increased slightly, the continued rise in global fuel prices may increase the risk of inflation, according to Indian research firm S&P Global and Crisil.
Signs of growing strain on the economy are already emerging. In a bid to save foreign exchange, Indian Prime Minister Narendra Modi on Sunday urged citizens to curb fuel consumption amid rising global prices, reduce overseas travel, and halt gold purchases.
The Indian rupee remained under pressure, trading near record lows against the dollar, as higher energy costs are expected to widen the country’s trade and current account deficits.
“Large increases in the cost of energy and other utilities, as well as trade and transportation, are expected to be passed on by producers to consumers, pushing up core inflation,” the note said on Monday.
Crisil expects inflation in India to average around 5.1% in the fiscal year ending March 2027.
