India Inflation Rate Down to 10-Month Low of 3.69%

Annual consumer inflation in India declined to 3.69 percent in August of 2018 from 4.17 percent in July and below market expectations of 3.86 percent. It is the lowest inflation rate since October of 2017, mainly due to a sharp slowdown in food cost.

Food and beverages inflation went down to 0.85 percent in August from 1.73 percent in July and the food index alone rose 0.29 percent, well below 1.37 percent in July. Inflation slowed for fruits (3.57 percent compared to 6.98 percent in July); prepared meals, snacks, sweets etc. (4.16 percent compared to 4.46 percent); milk and products (2.66 percent compared to 2.96 percent); and eggs (6.96 percent compared to 7.41 percent). Also, prices fell for vegetables (-7 percent compared to -2.19 percent); pulses and products (-7.76 percent compared to -8.91 percent); and sugar and confectionery (-5.45 percent compared to -5.81 percent). On the other hand, prices rose faster for non-alcoholic beverages (1.86 percent compared to 1.4 percent); oils and fats (3.47 percent compared to 2.79 percent); spices (2.88 percent compared to 2.66 percent); and meat and fish (3.21 percent compared to 2.26 percent). 

Among non-food products, prices rose at a softer pace for: housing (7.59 percent compared to 8.3 percent); clothing and footwear (4.88 percent compared to 5.28 percent); pan, tobacco and intoxicants (5.34 percent compared to 6.34 percent); and miscellaneous (5.52 percent compared to 5.8 percent). Inflation rose for fuel and light (8.47 percent compared to 7.96 percent).

The corresponding provisional inflation rates for rural and urban areas were 3.41 percent and 3.99 percent, compared with July's figures of 4.11 percent and 4.32 percent respectively.

On a monthly basis, consumer prices increased 0.43 percent in August, after a 0.94 percent gain in July.

India Inflation Rate Down to 10-Month Low of 3.69%

Joana Taborda |
9/12/2018 12:25:43 PM