India sees food inflation easing

NEW DELHI, Sept 26 (Reuters): India expects food inflation to ease in the absence of climatic shocks, and low oil prices will be a "bright spot for the economy", the government's monthly economic report said on Thursday.

India's central bank said this month headline inflation may average 4.5 per cent in the second half of the fiscal year, aided by weaker crude oil prices, but volatility in food prices could pose a challenge.

India's retail inflation was 3.65 per cent in August, higher than the revised 3.60 per cent in July, as vegetable prices soared.