India’s food prices limit scope for further rate cuts

Rising food inflation: A file picture showing an Indian trader checking onions at a market in Ahmadabad. Food inflation in November rose to an almost six-year high and is seen staying around those levels over the next few months. — AP

MUMBAI: India’s volatile food prices are yet again posing a sticky inflation problem for its central bank, preventing it from cutting rates as deep as it would like to support a stuttering economy.

After slashing rates five times this year, the Reserve Bank of India (RBI) stunned markets earlier this month by resisting a sixth reduction as many had predicted.