NEW DELHI, Dec 28: India’s inflation rate fell two-tenths of a percentage point to 3.45 per cent, official data showed on Friday, but analysts held out little hope of an early interest rate cut.
Annual inflation slowed to 3.45 per cent for the week ended Dec 15 from 3.65 per cent the previous week, according to the wholesale price index, India’s most watched cost-of-living monitor.
The fall was driven by lower prices of fruits, vegetables and textile products. However, poultry, spices and prices of some other goods rose.
Annual inflation stood at 5.73 per cent a year ago.
Inflation has fluctuated in recent weeks but is still well below the central bank’s target of close to five per cent for the fiscal year to March 31, 2008.
Analysts say they expect no swift cut in interest rates as the central bank fears high global oil prices could trigger a rise in state-set domestic fuel prices and is concerned about strong world commodity prices.
The central bank “would prefer to see a meaningful correction in international oil and food prices before officially signing off on a loosening of monetary policy,” said economist Chetan Ahya at Morgan Stanley in a research note.
India’s crude costs have shot up by nearly 150 per cent since April 2004 but retail petrol prices have risen by just 29 per cent. The price caps are costing state-run oil retailers around $50m a day.
“There is little chance of interest rates coming down due to high inflationary expectations,” HDFC Bank’s chief economist Abheek Barua said.
Growth for the first half of the fiscal year to March 31 was 9.1 per cent. But economists expect the economy to lose pace in coming months as effects of aggressive monetary tightening to curb prices take hold.
HONG KONG: Hong Kong exports growth rose 6.6 per cent in November, slowing from a 9.8 per cent increase in October, on declines in exports to the United States, official figures showed Friday.
A government spokesman said the Chinese market was vibrant although it expanded at a less rapid pace than in previous months.
Most major Asian markets performed well, off-setting the 3.4 per cent fall in exports to the US.In November, total exports stood at 244 billion Hong Kong dollars (31.30 billion US) with re-exports, or goods mostly produced in neighbouring China and exported from Hong Kong, up 6.9 percent to 234 billion dollars.
Domestic exports increased 0.8 per cent to 10 billion dollars in November, while imports grew 9.3 per cent to 260 billion dollars.
For the first 11 months of 2007, total exports rose 9.30pc with re-exports up 11.10pc, imports up 10.30 per cent but domestic exports down 20.60 per cent.—AFP
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