NEW DELHI: In a double setback for the Indian economy retail inflation spiked in April while industrial growth stagnated, denting chances of a rate cut by the Reserve Bank of India in the June review. The two sets of numbers released by the Central Statistics Office on Thursday showed Index of Industrial Production rose only 0.1% in March, while higher food and fuel prices drove retail inflation to 5.39% in April compared with 4.83% in March.“The data sets are not pleasant. IIP is rather disappointing on account of capital goods and non-durable goods. This shows that growth is extremely vulnerable,” said Upasna Bharadwaj, an economist at Kotak Mahindra Bank. “There is a dim chance for the RBI to act in June because of the uncertainty in monsoons. There is room to act but RBI will stay put in June.”Industrial production growth was 2.4% in all of 2015-16 compared with 2.8% in the previous financial year. A better-than-expected growth in core sector output had raised hopes of a decent growth in IIP. The core sector, which has a 38% weight in IIP, rose 6.4% in March, at the fastest pace in 16 months. The contraction in the IIP in December was revised to 0.9% from 1.2%.Retail inflation picked up in April for the first time since January. RBI chief Raghuram Rajan aims to cap retail inflation at 5% by March 2017. The pace of price gains in April was driven by higher food costs. An early summer heat wave led to a 34% increase in prices of pulses, which fuelled the 6.21% rise in food prices.The numbers suggest the RBI may not cut rates at its June 7 policy review. “It is a major disappointment on both fronts…all indications of a turnaround are shattered. Reservoir levels are down and there is a drought in Maharashtra. RBI will be cautious of the monsoons, its spread and its effect on crops. It is premature for a rate cut,” said CARE Ratings’ chief economist Madan Sabnavis.Soumya Kanti Ghosh, chief economic advisor at State Bank of India, said the RBI will keep on hold the rates, depending on the monsoon, which typically starts in the first week of June.Manufacturing and mining contracted 1.2% and 0.1%, respectively, in March, although electricity generation rose 11.3%. A 15.4% contraction in capital goods sector indicate the continued weakness of investment demand. Consumer non-durables production fell 4.4%, while output of durables rose 8.7%, highlighting the rural-urban divide.Sunil Sinha, principal economist at India Ratings & Research, said despite the government’s focus on Make in India, the ground reality is different and any real and sustainable turnaround in industrial output is not visible over the two quarters.