India Inflation July 2017


India: Price pressures ease in June

July 14, 2017

In June, consumer prices rose 0.53% from the previous month, which followed May’s 0.23% rise. A moderate increase in prices for food and beverages was recorded, while fuel and light prices declined from the previous month. Inflation fell to a record low of 1.5% in June, after coming in at 2.2% in May. The result slightly undershot market expectations of 1.6% and should give the Central Bank space to ease monetary conditions going forward. Inflation lies below the Central Bank’s medium term target of 4.0%.

The wholesale price index (WPI) in June declined 0.09% from the previous month, which followed May’s 0.35% fall. Rising prices for primary articles was partly offset by lower prices for fuel and power products, as well as manufactured products. Wholesale price inflation fell from May’s 2.2% to 0.9%, a six-month low. The trend, however, pointed upward and annual average wholesale inflation rose to 2.5% from 2.4% in May.

FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 4.7% in FY 2017, which is unchanged from last month’s forecast. In FY 2017, the panel expects consumer price inflation to average 5.0%.

Author: Angela Bouzanis, Senior Economist

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India Inflation Chart

India Inflation June 2017

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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