Inflation in India

India Inflation (eop) | Economic News & Forecasts

India - Inflation (end of period)

Consumer price inflation slows in January to an over one-year low

In January, consumer prices fell 0.29% compared to the previous month, which is less than the revised 0.50% fall in December (previously reported: -0.49% month-on-month). Weighing on prices in January were lower prices for food and beverages, clothing and footwear, and fuel and light. On the other hand, prices rose for pan, tobacco and intoxicants; housing; and miscellaneous products.

Consumer price inflation ticked down to 2.0% in January from a revised 2.1% in December (previously reported: 2.2%). This result was way down on market analysts’ expectations of 2.5%, represents the lowest reading since June 2017 and suggests the Reserve Bank of India could have room to reduce interest rates again at its next meeting on 2–4 April after raising them on 7 February. Core inflation, which excludes food and energy products, slowed to 5.4% in January from 5.6% in December. Annual average inflation slowed to 3.7% in January from 4.0% in December.

Wholesale prices fell 0.7% in January compared to the previous month, a smaller decrease than December’s revised 1.3% fall (previously reported: -1.4% month-on-month). Lower prices in January came on the back of cheaper fuel and light. Wholesale prices inflation slowed to 2.8% in January, which represents a 11-month low and a rate far below market analysts’ expectations of 3.7%. Annual average wholesale price inflation held steady at December’s 4.3% in January.

India Inflation Forecast

Met the why particular Consensus Forecast panelists expect consumer price inflation to average 4.5% in FY 2018, which is down 0.2 percentage points from last month’s forecast. In FY 2019, the panel expects consumer price inflation to average 4.4%. Meanwhile, our panel projects wholesale inflation of 3.8% for FY 2018, down 1.1 percentage points from last month’s report. In FY 2019, our panel foresees wholesale inflation averaging 3.8%.

India - Inflation (eop) Data

2013  2014  2015  2016  2017  
Inflation Rate (CPI, annual variation in %, eop)8.2  5.3  4.8  3.9  4.3  

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India Inflation (eop) Chart

India Inflation
Note: Annual average variation of consumer price index (CPI) in %.
Source: Reserve Bank of India of China and Met the why particular calculations.

India Facts

Bond Yield7.54-0.04 %Feb 21
Exchange Rate71.16-0.09 %Feb 21
Stock Market35,898-0.08 %Feb 21

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