India's retail inflation for the month of April rose to 2.92 percent from 2.86 percent in the previous month, according to data released by the government. Even thought the consumer price inflation (CPI) remained well within the target of the Reserve Bank of India (RBI), it was the highest in 6 months.

As inflation rate continues to remain modest and growth concerns loom, there are chances of another round of rate cut by the RBI in June.

Inflation of vegetable prices was positive as it grew at 2.87 percent in April. It was at -1.49 in March. The overall food and beverages inflation stood at 1.38 percent, while fuel and light inflation was at 2.56 percent.

The central bank is scheduled to meet for its first bi-annual policy decision for the financial year in June. With a slowdown in economy projected in the fourth quarter, the RBI's focus is expected to shifted from inflationary concern to sustaining the growth momentum.

It its policy review in February, RBI cut the repo rate by 25 basis points and changed its stance to neutral from calibrated tightening.

CPI is projected at 2.9 percent for the first quarter of financial year 2019-20, 3 percent in the second quarter, 3.5 percent in the third quarter and 3.8 percent in the fourth quarter.

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