Global Biz

India March inflation at 9%, more than expected

(Agencies)
Updated: 2011-04-15 16:38

MUMBAI, India - India's monthly inflation rose to 8.98 percent in March as manufacturing and fuel costs increased, the government said Friday, adding to worries about rising prices across emerging Asia.

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Prices continue to spiral upward despite a record crop output, more evidence that India's price problem has moved beyond volatile food and fuel prices. That will likely encourage India's central bank to continue its aggressive interest rate hikes.

The March number, up from 8.31 percent in February, came in much higher than expected. Analysts surveyed by FactSet had predicted, on average, an 8.36 percent rise in prices for March.

The government also said January inflation was 9.35 percent, rather than 8.23 percent as previously reported.

Fuel prices rose 3.9 percent from February, while the cost of manufactured goods was up 1.4 percent. Food prices fell nearly 1 percent from February.

The International Monetary Fund warned this week that emerging Asian economies are in danger of overheating, as rapid growth, high output and loose monetary policy continue to put upward pressure on prices.

It singled out India, where it expects inflation to average 7.5 percent this year, as suffering from the worst inflation in the region.