India's inflation down

(MENAFN) India's inflation cooled to a more than three-year low in May, data showed yesterday, but the rupee's plunge will likely stall any interest rate cut to kickstart the ailing economy. The Wholesale Price Index, India's most closely watched inflation gauge, dropped to 4.7 per cent in May on an annual basis, down nearly two-tenths of a percentage point from its 4.89 per cent level in April. The broadly based wholesale price inflation reading, the lowest since late 2009, was well below market forecasts of a 4.9 per cent rise. It was also inside the central bank's so-called 5.0 per cent "comfort zone", even though the narrower-based retail inflation measure is double the level near 10 per cent. But the Indian currency's slide to a lifetime low of 58.98 rupees to the dollar earlier in the week has sparked fears inflation could resurge as a key problem in India, which buys 80 per cent of its crude oil from abroad.