India Inflation May 2017


India: Price pressures ease in May

June 12, 2017

In May, consumer prices rose 0.23% from the previous month, which followed April’s 0.15% 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 2.2% in May, after coming in at 3.0% in April. The result undershot market expectations of 2.4% 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 May declined 0.35% from the previous month, which followed April’s 0.18% fall. Prices fell across the board, including for fuel and power products. Wholesale price inflation fell from April’s 3.9% to 2.2%, a five-month low. The trend, however, pointed upward and annual average wholesale inflation rose to 3.4% from 2.2% in March.

FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 4.8% 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 May 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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