India: Inflation falls to nine-month low
March 14, 2014
The wholesale price index (WPI)-India's preferred inflation measure-was unchanged over the previous month in February. The reading, which was up from the 0.39% decrease observed in January, resulted primarily from a decline in prices for primary products, particularly for food, which offset higher prices for manufactured goods, especially for wood and chemical products. Wholesale prices increased 4.7% over the same month last year in February, which came in below both the 5.1% rise observed in January and market expectations of a 4.9% increase. The annual reading represents the lowest rate in nine months. As a result of the fall in the annual figure, annual average WPI inflation inched down from January's 6.1% to 5.9% in February. The consumer price index was also unchanged over the previous month in February, which followed the 0.44% fall recorded in January. Annual inflation fell from 8.8% in January to 8.1% in January, marking the lowest level since January 2012. FocusEconomics Consensus Forecast panelists expect wholesale price inflation to average 5.8% in fiscal year 2014/2015, which is unchanged from last month's forecast. In fiscal year 2015/2016, the panel expects wholesale price inflation to average 5.7%.
Author: Ricardo Aceves, Senior Economist