India’s wholesale inflation (INWPI=ECI) accelerated in December to 2.37% year-on-year, from 1.89% in November, government data showed on Tuesday, but in line with market expectations.
The wholesale inflation rate, a proxy for producer prices, last month came largely in line with the 2.3% forecast by economists in a Reuters poll.
Food prices rose 8.89% last month, compared with an 8.92% increase in November, with vegetable prices climbing 28.65% year-on-year, marginally up from a 28.57% rise in the previous month. Cereal prices rose 6.82% in December as against a 7.81% rise a month ago.
Prices of manufactured products, which account for about 64% of the wholesale price index, increased 2.14% from a 2% increase in the previous month.Fuel and power prices in India dropped 3.79% year-on-year, compared with a 5.8% drop in November.
Headline retail inflation, the key target for the Reserve Bank of India’s monetary policy decisions, eased to a four-month low of 5.22% in December, down from 5.48% in the prior month.
The easing rate of retail inflation and a sharp slowdown in India’s growth to a four-year low of 6.4% in 2024-25 has increased pressure on the Reserve Bank of India to cut rates in its next monetary policy committee review due in February.
(Except for the headline, this story has not been edited by Firstpost staff.)
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India’s wholesale inflation rises in December, but stays in line with expectations at 2.37%
