India Inflation December 2016


India: Inflation eases while wholesale price inflation rises in December

January 16, 2017

In December, consumer prices in India fell 0.61% from the previous month, which followed November’s 0.15% decrease. The monthly fall chiefly reflected lower prices for food and beverages. Inflation continued to fall in December, declining from November’s 3.6% to an over two-year low of 3.4%. As a result, inflation is slightly below the center of the Central Bank’s target of 4.0% plus/minus 2.0 percentage points.

The wholesale price index (WPI) in December fell 0.16% from the previous month, after decreasing 0.27% in November. The fall in the index was driven by lower prices for food articles and other primary products. Wholesale price inflation rose to 3.4% in December from 3.2% in November. The trend pointed up and annual average wholesale inflation rose to 2.0% in December from 1.6% in November.

FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 4.9% in FY 2016, which is unchanged from last month’s forecast. In FY 2017, the panel expects consumer price inflation to average 5.0%.Panelists expect wholesale price inflation of 2.9% in FY 2016, which is unchanged from last month’s forecast. In FY 2017, the panel expects wholesale price inflation to average 3.6%.

Author: Angela Bouzanis, Senior Economist

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India Inflation Chart

India Inflation December 2016

Note: Annual and monthly variation of wholesale price index (WPI) and annual variation of consumer price index (CPI) in %.
Source: Ministry of Commerce and Industry and FocusEconomics calculations.

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