India’s annual wholesale price-based inflation eased marginally in December to 13.56%, but remained in double digits for a ninth successive month, reflecting rising input costs for firms, many of which are steadily passing on costs to consumers.
December’s figure was marginally lower from the previous month’s 14.23%, which was the highest in more than a decade, government data showed on Friday.
Rising input costs for products such as fuel, metals and chemicals have pushed up wholesale prices, a proxy for producers’ prices, in recent months, while headline retail inflation is hovering around 5%, still within the 2%-6% target of Reserve Bank of India (RBI).
The RBI left the benchmark repo rate (INREPO=ECI) unchanged at 4.0% for a ninth consecutive meeting last month as economic growth remains a challenge amid rising COVID-19 cases.
Consumer price-based inflation, the main gauge monitored by the monetary policy committee of RBI, rose to a five-month high of 5.59% in December from the corresponding month last year, from November’s 4.91%, separate data showed on Wednesday. read more
Analysts fear that rising Omicron cases, central banks’ unwinding of easy liquidity and climbing global crude oil prices could push domestic prices even higher in the next few months before easing in the second half of the year.
On Friday, India reported 264,202 new cases of the coronavirus, taking its total tally to 36.58 million, while the death toll increased to 4,85,350, the federal health ministry said. read more
Wholesale fuel and power prices in December rose 32.30% on the year versus 39.81% in November, while manufactured product prices rose 10.62%, against 11.92% in the prior month.
Wholesale prices of food accelerated at a 6.70% pace, versus 3.06% the previous month.