India CPI inflation _ Core Decelerates | Headline broadly in line with estimates.

India CPI came in at 5.09% and Core CPI at 3.34%. Eggs / Vegetables /Pulses / Spices rose in double digit Yoy while oil and fat fell (-14% yoy). Concerning component was the meat and fish basket which grew 2.30% mom and Housing which grew at 0.50% mom.  Spices though up 13.50% yoy were down 2% mom and likewise for pulses and products , down 0.83% mom. 

RBIs Q4 projections for CPI are at 5.00% which translates into Mar reading of 4.80%. The number does not change anything meaningfully for the Central Bank. According to my own estimates, CPI is likely to average 5.20% in Q1 FY25 as against RBIs estimate of 5.00% which leaves very little wiggle room for any rate action. 

RBIs repeated stance has been to guard against generalization of food price pressures and with weather uncertainty and low reservoir levels, rate action window open in Q2 FY2025.