India: Inflation accelerates in June
July 14, 2011
In June, the wholesale price index (WPI) ? India's headline inflation measure ? increased 0.86% over the previous month, which contrasted the revised 0.26% price drop observed in May (previously reported: +0.73% month-on-month). As a result, annual WPI inflation accelerated to 9.4% (May: 9.1%) which, nevertheless, was below market expectations that had inflation rising to 9.7%. The monthly climb was mainly driven by higher prices for food (+1.93% mom) as well as for minerals (+17.17% mom), in particular crude petroleum. Moreover, fuel prices rose as the government authorised a slight increase in the price of diesel, kerosene and cooking gas. Meanwhile, the slightly dated consumer price index for industrial workers (CPI-IW) increased 0.54% in May over the previous month, which mirrored the previous month's increase. As a result, annual CPI-IW inflation fell from 9.4% in April to 8.7% in May, which was in line with developments observed in the WPI measure. Despite the monthly hike, annual average WPI inflation inched down from a revised 9.4% in May to 9.3% in June.