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India: Wholesale prices tumble in February

March 16, 2015

Consumer prices in February increased 0.81% over the previous month, which contrasted January’s zero growth. The monthly result mainly reflected higher prices for alcoholic beverages and tobacco as well as for housing and fuel. Inflation rose from January’s 5.1% to 5.4% in February, which was above the 5.2% that markets had expected.

The wholesale price index (WPI) in February decreased 1.4% over the previous month, which was notably above the revised 0.22% fall observed in January (previously reported: -0.83% month-on-month). February’s fall came on the back of a large decrease in fuel prices which stem from the recent sharp fall in global oil prices. Decreases were also recorded for the prices of foods articles and manufactured prices.

Wholesale prices in February fell 2.1% over the same month last year, which followed January’s 0.4% decrease and marked the steepest decrease since January 2000. February’s print was below the 0.8% fall the markets had expected. As a result of the subdued reading, annual average WPI inflation fell from 3.3% in January to 2.7% in February.

FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 5.8% in FY 2015/2016, which is unchanged from last month’s forecast. In FY 2016/2017, the panel expects consumer price inflation to average 5.8%. Panelists expect wholesale price inflation to average 2.0% in FY 2015/2016, which is unchanged from last month’s forecast. In FY 2016/2017, the panel expects wholesale price inflation to average 4.4%.


Author: Angela Bouzanis, Senior Economist

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India Inflation Chart


India Inflation February 2015

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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