India Inflation April 2016

India

India: Inflationary pressures rise in April

May 16, 2016

Consumer prices increased 0.95% in April over the previous month, which followed March’s flat growth and marked an eight-month high. The result was mainly driven by a rise in prices for food and beverages as well as for tobacco and intoxicants. Inflation rose in April, coming in at 5.4%, which represented a three-month high (March: 4.8%). April’s result surpassed market expectations of a slight rise in inflation to 5.0%.

The wholesale price index (WPI) in April rose 1.37% over the previous month, which was above March’s 0.29% increase. April’s reading reflected rising prices for primary products as well as for fuel and power products. On an annual basis, wholesale price inflation returned in April and came in at 0.3%. The result was the highest reading since April 2015 and contrasted March’s 0.9% annual decrease in wholesale prices. In addition, the trend pointed up and annual average variation in wholesale prices rose from minus 2.5% to minus 2.3%.

FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 5.1% in FY 2016, which is unchanged from last month’s forecast. In FY 2017, the panel expects consumer price inflation to average 5.2%. Panelists expect wholesale price inflation of 1.4% in FY 2016, which is down 0.1 percentage points from last month’s forecast. In FY 2017, the panel expects wholesale price inflation to average 3.4%.


Author: Angela Bouzanis, Senior Economist

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India Inflation April 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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