New Delhi, 30 June (IANS). Inflation is estimated to be 2.5 percent on average in the next six months due to favorable weather conditions. According to the HSBC report released on Monday, food inflation in India is expected to be shorter for the last three years and strong grain production.
HSBC Global Investment Research said in its report that core inflation also remains controlled due to strong Indian rupees, falling prices of commodity, imported inflation from China and less increase than a year ago. Given all these factors, inflation is expected to be 3.2 percent on an average in FY 2026.
FY 2025 ended on a strong note for India’s food stores, with strong grain production ensuring adequate stock levels. This abundance is expected to help control grain inflation in the near future.
The report said that rain, reservoir level and sowing will matter in FY 2026. Currently, the rainfall level is 9 percent higher than normal, which is much higher than rains in the last three years. Regionally, North-West and Central India have received the highest rainfall. IMD hopes that the whole country will rain in the next few days.
The report said, “Good rains not only benefit summer sowing, but also help in filling the reservoirs, which temporarily provide buffer in the event of rain stops and also support irrigation in winter sowing season. Currently, the reservoir levels are more than the general storage levels, with the level of previous year, in which the southern region is specially performing well.”
There are still the early days of the weather, but still sowing is going well. As of 20 June, the total sowing area is about 14 million hectares so far, which is 10 percent more than the previous year.
The sowing area under rice, pulses and grains has increased compared to the same period last year. However, sowing of oilseeds has so far been relatively weak.
According to the report, strong sowing activity is a good sign for demanding agricultural workers and their salary scenario. Already the nominal increment for agricultural laborers is running 8 percent in April, which was 6.5 percent earlier.
The report said, “In addition, the decline in inflation is helping to promote actual wages. We believe this will promote large -scale consumption in the coming months.”
-IANS
SKT/
