Consumer prices climbed 1.1% year-on-year in February, faster than the 0.6% rise seen a month ago.
The competitive environment facing Kroger from Walmart and Amazon.com (AMZN) via its Whole Foods division, among others, offers at least some reason to doubt whether wage pressure will feed through to higher prices. Fuel inflation, meanwhile, rose to 6.80% in February 2018 compared to 7.64% in January 2018.
For the year, headline inflation increased 2.2%, the report said.
RBI has estimated CPI inflation in the range of 5.1-5.6% in H1FY19, including the diminishing statistical HRA impact on central government employees.
Within the February numbers, there were signs that price pressures were running hotter than they had been at this point in 2017.
Next week, the Fed is widely expected to raise short-term interest rates for the sixth time since late 2015, when it started lifting rates from almost zero.
The central bank expects inflation to pick up to 5.1-5.6 percent in April-September and then ease later on anticipation of for normal rainfall.
X The soft inflation reading could slightly lower odds of a fourth Fed interest-rate hike in 2018. Policymakers consider the labor market to be near or a little beyond full employment.
Industrial production grew at 4.1 per cent in April-January this fiscal as compared to 5 per cent in same period in previous financial year. "Domestic pump prices of petrol and diesel rose sharply in January, reflecting lagged pass-through of the past increases in worldwide crude oil prices".
The report showed an index of energy prices rose 0.1% in February, as gasoline and fuel oil costs both fell. Food prices rose 0.2 percent in January.
Inflation was 17.57 per cent for vegetables, down from 26.97 per cent in January.
The world index has recovered about half its losses sustained during a shakeout in stocks in February.
European shares opened positive, with the pan-European STOXX 600 gaining 0.1 per cent.
Prices of new motor vehicles fell 0.5 percent, the biggest drop since August 2009, after slipping 0.1 percent in January. The decline comes after prices for new and used cars jumped last fall as residents of Texas and Florida replaced cars destroyed by hurricanes.