India's March inflation uptick

India’s retail inflation in March rose to 3.40%, its highest reading in 13 months, after food prices and cooking gas costs picked up. (thehindubusinessline.com) The Ministry of Statistics and Programme Implementation said the Consumer Price Index was 3.40% in March, up from 3.21% in February. Food inflation rose to 3.87% from 3.47% a month earlier. (static.pib.gov.in) Rural inflation ran hotter than urban inflation in March. Consumer price inflation was 3.63% in rural India and 3.11% in urban India, while food inflation was 3.96% in rural areas and 3.71% in cities. (static.pib.gov.in) India’s inflation target is 4%, with a tolerance band of 2% to 6%, so March still sat below the central bank’s goal. Reuters said the March reading was also below the 3.48% estimate in its poll. (rbi.org.in); (economictimes.indiatimes.com) The March number landed five days after the Reserve Bank of India left its key policy rate unchanged and warned that the West Asia crisis could lift inflation and slow growth. The central bank said it expects average inflation of 4.6% in the 2026-27 financial year. (rbi.org.in); (economictimes.indiatimes.com) Local reporting tied part of March’s rise to higher liquefied petroleum gas costs and pricier vegetables. BusinessLine said the increase was driven by liquefied petroleum gas and select vegetables, while the official release showed transport inflation at 0.00% and housing inflation at 2.11%. (thehindubusinessline.com); (static.pib.gov.in) Economic Times and Reuters linked the inflation risk to the Middle East conflict, which has pushed oil prices higher and raised fears about shipping through the Strait of Hormuz. Reuters reported Brent crude rose above $100 a barrel after the United States said its navy would block ships to and from Iran. (economictimes.indiatimes.com); (economictimes.indiatimes.com) That matters more for India than for many large economies because it imports about 90% of its oil. Reuters said the Reserve Bank of India now expects gross domestic product growth to slow to 6.9% in 2026-27 from 7.6% in the year ended March 31. (economictimes.indiatimes.com) For now, inflation remains inside the Reserve Bank of India’s comfort zone, but March ended a two-month run of softer readings. The next test is whether food and fuel pressures fade in April or start feeding into a broader rise in household prices. (static.pib.gov.in); (rbi.org.in)