India: Price pressures moderate in August
September 14, 2016
In August, consumer prices were flat over the previous month, which contrasted July’s 0.77% rise. The monthly result mainly reflected that a mild rise in prices for pan, tobacco and intoxicants were balanced by lower prices for food and beverages as well as for fuel and light. Inflation fell from July’s nearly two-year high of 6.1% to 5.0% in August. As a result, inflation is at the upper limit of the Central Bank’s target of 4.0% plus or minus 2.0 percentage points.
The wholesale price index (WPI) in August fell 0.44% over the previous month, which contrasted July’s 0.55% increase and marked a six-month low. August’s reading reflected falling prices for primary articles as well as for fuel and power products. Wholesale price inflation was broadly stable, inching up from 3.6% in July to 3.7% in August. The trend pointed up and the annual average variation in wholesale prices rose from minus 1.0% in July to minus 0.2% in August.