India's April inflation likely dipped below 5%; March IIP was likely tepid

India will release April CPI and March IIP data on 12 May. Inflation is expected to have dipped to 4.85% y/y from 5.17% in March. 

Unseasonal rainfall likely pushed prices, especially vegetable prices, marginally higher, but last year's strong base effect likely offset this and increased core inflation to 4.27% from 4.14% in March. 

The market will watch April inflation data closely, as it will be the last print the Reserve Bank of India will have before it announces its monetary policy decision on 2 June. 

A downside surprise may raise expectations of yet another intermeeting rate cut, while an upside surprise may raise expectations of a pause at the next meeting. 

"We expect industrial production growth to have weakened to 0.8% y/y from 5.0% in February on weakness in the export and infrastructure sectors", says Standard Chartered.