India: Price pressures strengthen in August but remain robust
September 15, 2017
In August, consumer prices rose 0.97% from the previous month, which followed July’s 1.67% jump. August’s reading mostly reflected higher prices for vegetables and fruits. Inflation accelerated to a five-month high of 3.4% in August (July: 2.4%). The reading slightly overshot market expectations of 3.2%. Despite the increase, inflation is still below the Central Bank’s medium-term target of 4.0%.
The wholesale price index (WPI) in August increased 0.79% from the previous month, which followed July’s 1.06% rise. Sharp price rises for vegetables and fruits, along with higher prices for power and fuel, were behind the increase. Wholesale price inflation gathered further pace in August, hitting 3.2%, which was up from 1.9% in July. The trend continued to point upward, with the annual average wholesale inflation rate rising to 2.8% from 2.6% in July.