DNA Money Edit: Double bonanza for India's growth

Drop in prices of foods such as vegetables, pulses and sugar has helped retail inflation moderate to a 13-month low of 3.31% in October, down from 3.7% in September and 3.58% in October last year. Vegetable prices fell 8.06% in October against a 4.15% drop in the previous month. Earlier concerns regarding minimum support price (MSP) hikes pushing up inflation seem to have been completely dispelled. However, the rise in core inflation that flared up to an unhealthy 6.1% in October, led by health services and commodity prices, is a worrying factor.

Meanwhile, the drop in consumer price index (CPI) has raised the prospect of the Reserve Bank of India (RBI) maintaining a status quo on the repo rate in its policy review in December. While the recent fall in crude oil prices to around $70 per barrel has helped the cause, the spurt in prices on Monday for the first time in 11 days amid Saudi Arabia's insistence that weaker demand warrants output cuts has raised some concerns. Analysts say rupee, food prices and post-monsoon rainfall may still sway the fortunes.

Industrial production in September grew at 4.5%, the slowest pace in four months on poor performance by the mining sector and lower offtake of capital goods. The comfort factor is that the figure is better than market expectations of a 4.3% growth.