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3mo ago

Inflation Diverges in U.S. and India as Food Prices Shape Trends

U.S. inflation edges up slightly in April, while India's retail and wholesale inflation drop to multi-year lows, signaling contrasting economic conditions.

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Airfare fell almost 3% in April, the third-straight monthly decline, according to the Bureau of Labor Statistics. Prices also fell for hotels and tickets to sporting events.
Food prices decreased .1% in April, while general costs for energy rose .7%. Prices for all items but food and energy increased .2%, according to the U.S. Bureau of Labor Statistics. Between April 2024 and last month, costs for all items rose 2.3%, the bureau reported. (PETER K. AFRIYIE/AP FILE)
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Overview

  • U.S. consumer prices rose 0.2% in April, with annual inflation at 2.3%, the lowest since February 2021, as food prices fell slightly but energy costs increased.
  • Core inflation in the U.S. remains elevated at 2.8% annually, with minimal impact yet from recently imposed tariffs, though future price pressures are anticipated.
  • India's retail inflation dropped to a 69-month low of 3.16% in April, staying below the Reserve Bank of India's 4% target for the third consecutive month.
  • India's wholesale inflation fell to a 13-month low of 0.85%, driven by significant declines in food prices, including an 18% drop in vegetable costs.
  • Economists widely expect the Reserve Bank of India to cut interest rates by 25 basis points in June, citing subdued inflation and the need to support economic growth.