India Inflation Rate Climbs to 7-Month High

India's retail price inflation rate rose to 3.05 percent year-on-year in May 2019 from an upwardly revised 2.99 percent in the previous month and slightly above market expectations of 3.01 percent. That was the highest rate since October last year, mainly supported by higher food prices. Still, inflation came in below the Reserve Bank of India's medium-term target of 4 percent for ten consecutive months.

Food prices rose 1.83 percent from a year earlier in May, faster than a 1.10 percent increase in April. Also, the food & beverages index went up 2.03 percent, with main upward pressure coming from: meat & fish (8.12 percent); vegetables (5.46 percent); non-alcoholic beverages (3.16 percent); prepared meals, snacks, sweets etc. (2.50 percent); pulses & products (2.13 percent); egg (1.80 percent); cereals & products (1.24 percent); spices (1.23 percent); oils & fats (0.91 percent); milk & products (0.35 percent); and sugar & confectionery (0.27 percent). By contrast, fruits prices dropped 5.17 percent.

Among non-food products, prices increased for housing (4.82 percent); miscellaneous (4.62 percent); pan, tobacco and intoxicants (3.93 percent); fuel and light (2.48 percent); and clothing and footwear (1.80 percent).

The corresponding provisional inflation rates for rural and urban areas were 1.86 percent and 4.51 percent, compared with April's figures of 1.87 percent and 4.30 percent respectively.

On a monthly basis, consumer prices went up 0.57 percent in May.

India Inflation Rate Climbs to 7-Month High

MOSPI | Joana Ferreira |
6/12/2019 1:18:38 PM