India’s March retail inflation quickens to 3.40% y/y

April 13 (Reuters) – India’s retail inflation quickened AZN4SQJGO to 3.40% year-over-year in March from 3.21% in February, government data showed on Monday.

A Reuters poll had projected retail inflation at 3.48%.

GAURA SENGUPTA, INDIA ECONOMIST, IDFC FIRST BANK, MUMBAI

“The march CPI shows limited pass ‌through of higher input cost by producers to consumers. Moreover, retail, petrol and diesel prices remain unchanged. There has been some increase ‌in LPG, ATF and CNG, but it is ranged bound.

The majority of the price shock has been absorbed by the government, OMCs for now. We expect rise in pass through of ​price pressures to the consumers in the coming months. FY 27 CPI inflation is expected to average at 4.9%.”SUJIT KUMAR, CHIEF ECONOMIST, NATIONAL BANK FOR FINANCING INFRASTRUCTURE AND DEVELOPMENT, MUMBAI

“Retail inflation edged up in March 2026, to 3.4% led by food prices. Core inflation, excluding food, beverages and fuel prices, remained steady at 3.7%, indeed modestly down on month to month basis, suggesting broader price pressures remain contained. There is need to watch for pass through of crude and commodity prices ‌that have risen amidst development around War in ⁠West Asia, going forward.” SAKSHI GUPTA, PRINCIPAL ECONOMIST, HDFC BANK, GURUGRAM

“The inflation print for March has come in at a benign level of 3.4%, lower than our expectation. This confirms that despite the rise in energy costs in the month ⁠of March, the pass through to retail inflation has been limited. This print confirms that the RBI has sufficient headroom before turning hawkish and looking at tightening policy.

That said, continued disruptions and elevated energy prices for an extended period of time could ultimately be passed on to consumers if producers continue to face margin pressures. ​We expect ​headline inflation to average at 4.9% in FY27.”

VIKRAM CHHABRA, SENIOR ECONOMIST, 360 ONE ASSET, ​MUMBAI

“Retail inflation edged up only marginally in March, as higher ‌energy costs were largely absorbed rather than passed on to consumers. However, inflation is expected to firm up gradually as elevated input costs, driven by the ongoing West Asia crisis, are increasingly passed through to consumers.

We are tracking early signs of price revision across FMCG, cement, paints, consumer durables and other categories, which could add to headline inflation in the coming months. Additionally, there are upside risks to food inflation stemming from a potentially weak monsoon.”

RADHIKA RAO, SENIOR ECONOMIST, DBS BANK, SINGAPORE

“March inflation numbers were modestly higher, signalling the first round of price pressures in wake of the Middle East crisis. Input ‌costs were selectively passed on to end consumers, and food costs continue to normalise, ​besides precious metal coming off the boil but still up double digits on the year.

We ​expect the impact of higher energy prices to gradually percolate in ​the coming months as replacement supplies arrive with a lag, while monitoring the risk of a fuel price increase in ‌the coming weeks.

Core inflation, meanwhile, stayed below 4%, reducing the ​need for the central bank to assume ​a hawkish stance in the near-term. Impact of higher oil and gas prices are likely to be more material in the WPI index.”

UPASNA BHARDWAJ, CHIEF ECONOMIST, KOTAK MAHINDRA BANK, MUMBAI

“The CPI inflation came in line with our expectations. We expect the trajectory to continue to trend ​higher, while remaining watchful on the risks from sub-par ‌monsoons and second order pass through of higher input prices and weakening INR.”

“However, we expect the RBI to maintain status quo ​on rates in the foreseeable future as more clarity emerges between the balance of risks between growth and inflation.”

(Reporting by Urvi ​Dugar, Pranav Kashyap and Kashish Tandon; Compiled by Abhinaya V; Editing by Ronojoy Mazumdar)