Retail Inflation rises to 5.21% in December 2017
This month the Consumer food price index (CFPI) stood at 4.96% compared to 4.35% of November 2017 and 1.37% of December 2016.
India's consumer price index (CPI) or retail inflation stood at 5.21% in the month of December 2017 - higher from 4.88% in November 2017 and 3.41% in the similar month of previous year.
The Consumer food price index (CFPI) stood at 4.96% compared to 4.35% of November 2017 and 1.37% of December 2016.
The Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation, has revised the Base Year of the Consumer Price Index (CPI) from 2010=100 to 2012=100 with effect from the release of indices for the month of January 2015.
Major indicators of CPI were all positive with food & beverages at 4.85%, pan, tobacco & intoxicants at 7.76%, clothing & footwear at 4.80`%, housing at 8.25%, fuel & light at 7.90% and miscellanous at 3.79%.
Analysts polled by Reuters had predicted December`s consumer inflation rate would climb to 5.10%, the highest since July 2016, from 4.88% in November.
RBI expected inflation to range between 4.3 and 4.7% in Q3 and Q4 of this year, including the HRA effect of up to 35 basis points, with risks evenly balanced.
Sunil Sinha, principal economist at India Ratings, told Reuters the RBI was unlikely to change its policy stance soon, adding "If the inflation pressure continues beyond this level, one can expect the central bank to change its policy stance to hawkish."
Dhananjay Sinha and Kruti Shah, analysts at Emkay, earlier said, “We expect CPI to increase to 5.2% yoy on an average in Q4FY18 which is much above RBI’s target of 4%.”
For December 2017, the State Bank of India (SBI) had stated that the numbers are expected to remain at elevated level, adding, “We project CPI inflation to come in between 5.0-5.2%.”
Similarly, Indranil Pan and Aditya Vyas, analysts at IDFC Bank, had said, "The Headline CPI inflation to remain higher than 5% for the remaining part of FY18 – to end at around 5.2% in March 2018."