India: Inflation jumps to eight-month high in October
November 14, 2013
In October, the wholesale price index (WPI) - India's preferred inflation measure - increased 0.33% over the previous month. The reading came in slightly below the revised 0.39% increase observed in September (previously reported: 1.24% month-on-month) and mainly reflects that, despite a flat reading in primary products, monthly inflation was driven by higher prices for fuel and power as well as for manufactured products, in particular for beverages, tobacco and tobacco products.
Wholesale prices increased 7.0% over the same month last year (September: 6.5%), which marks the highest rate in eight months. The annual reading was in line with market expectations of a 7.0% increase. Despite the jump in the annual figure, annual average WPI inflation remained steady at September's 6.3%.
In addition, the consumer price index increased 0.95% over the previous month in October, which was slightly below the 1.19% increase observed in September. Annual inflation climbed from 9.8% in September to 10.1% in October.
FocusEconomics Consensus Forecast panelists expect wholesale price inflation to average 5.9% in fiscal year 2013/2014, which is unchanged from last month's forecast. In fiscal year 2014/2015, the panel expects wholesale price inflation to average 5.8%, which is also unchanged from last month's estimate.
Author: Ricardo Aceves, Senior Economist