India Inflation

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India: Inflation rises in May and wholesale prices annual decline moderates

June 15, 2015

Consumer prices in May increased 0.75% over the previous month, which was above April’s 0.42% rise. The monthly result mainly reflected increases in the prices of tobacco and intoxicants as well as of clothing and footwear. In additions, prices of food and beverages as well as fuel also increased. Inflation rose from 4.9% in April, which had marked a five-month low, to 5.0% in May. The result was in-line with market expectations.

The wholesale price index (WPI) in May rose 0.97% over the previous month, which contrasted the 0.06% fall observed in April. May’s increase came on the back of a rise in fuel prices and primary articles. In addition, prices for manufactured products increased compared to the previous month.

Wholesale prices in May fell 2.4% over the same month last year, which followed April’s 2.7% decrease. As a result, annual average WPI inflation fell from 1.3% in April to 0.6% in May.

FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 5.5% in FY 2015/2016, which is down 0.1 percentage points from last month’s forecast. In FY 2016/2017, the panel expects consumer price inflation to average 5.6%. Panelists expect wholesale price inflation to average 1.5% in FY 2015/2016, which is down 0.3 percentage points from last month’s forecast. In FY 2016/2017, the panel expects wholesale price inflation to average 4.2%.


Author: Angela Bouzanis, Senior Economist

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India Inflation Chart


India Inflation May 2015

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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