India: inflation rises to 5.54%, the highest in almost 2 years

WHAT HAPPENED

Inflation in India rose from 4.83% to 5.54% in September, its highest level in almost two years. Food prices increased by 7.74% and onions became 108% more expensive compared to last year.

WHY IT MATTERS

A weaker monsoon reduced harvests and raised food prices; fuel also puts pressure. To curb it, the central bank raised its rate to 5.50%, making loans and credit more expensive. Agriculture, transportation, construction, and consumption feel it first.

AND FOR YOUR PORTFOLIO

In India, a grocery bill of 100 rupees now costs almost 108, and it may cost more if it includes a lot of onions. For long-term investments, high rates usually cool consumption and construction, while elevated prices reduce the disposable income of households.