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Informist, Thursday, Dec. 12, 2024

 

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--India Nov CPI inflation 5.48% vs 6.21% Oct 
--Informist poll estimated India Nov CPI inflation at 5.6% 
--India Nov CPI food inflation 9.04% vs 10.87% Oct 
--India Nov CPI rural inflation 5.95% vs 6.68% Oct 
--India Nov CPI urban inflation 4.83% vs 5.62% Oct 
--India Nov CPI combined index down 0.2% on month 
--India Nov CPI food price index down 0.6% on month 
--India Nov CPI cereals and products index up 0.9% on month 
--India Nov CPI vegetable index down 4.6% on month 
--India Nov CPI pulses and products index down 0.2% on month 
--India Nov CPI oils and fats index up 3.1% on month 
--India Nov CPI food, beverage index down 0.5% on month 
--India Nov CPI housing index up 0.2% on month 
--India Nov CPI clothing, footwear index up 0.3% on month 
--India Nov CPI fuel and light index down 0.1% on month 
--India Nov CPI miscellaneous index up 0.2% on month 
--India Nov CPI core inflation 3.7% vs 3.7% Oct

 

NEW DELHI - India's CPI inflation moderated to 5.48% in November from a 14-month high of 6.21% in October, data released Thursday by the National Statistical Office showed. The fall in headline inflation was mainly because of a sequential decline in food prices.

 

CPI inflation of 5.48% in November was below consensus expectations. According to an Informist poll, the headline inflation was seen at 5.6% in November.

 

In October, CPI inflation had risen above the Reserve Bank of India's tolerance range of 2-6% for the first time since August 2023. With the November print at 5.48%, headline inflation has stayed above the RBI's medium-term target of 4% for the third consecutive month after having stayed below it in July and August.

 

Food inflation eased to 9.04% in November from a 15-month high of 10.87% in October. Sequentially, the food price index fell 0.6% in November, which led to a 0.2% on-month fall in the general index of the CPI.

 

Within food, prices of vegetables and pulses declined sequentially in November, while prices of edible oils and cereals rose from October. Vegetable prices fell 4.6% on month in November, pulled down by a 23.5% sequential fall in tomato prices. Meanwhile, onion prices were up 2.6% from October, while prices of potato were flat on month. 

 

Edible oil prices rose 3.1% on month in November, while cereal prices increased 0.9% from October. The food and beverage index was down 0.5% sequentially last month.  

 

Core inflation, which strips out food and fuel items, remained at 3.7% for the second consecutive month in November. Last time core inflation was higher than 3.7% was in December 2023, when it was 3.9%.

 

"We expect inflation to gradually inch lower towards 4.5% by the Jan-March quarter," said Sakshi Gupta, principal economist at HDFC Bank. "While the moderation in inflation does increase the chances of a rate cut by the RBI in the February policy; however, any upsets on food inflation due to a warmer winter or an increase in pressure on the rupee, could still nudge the central bank to postpone the rate cut to the April policy," Gupta said.

 

Bank of Baroda Chief Economist Madan Sabnavis said that preliminary indications point to inflation staying above 5% in December as well, based on food prices witnessed so far.

 

With inflation averaging 5.8% in Oct-Dec, the headline print would have to be around 5.5% in December as well, in order to come in line with the RBI's projection of 5.7% for the quarter. The RBI last week raised its CPI inflation projection for 2024-25 (Apr-Mar) by 30 basis points to 4.8% mainly because of the sharply higher than expected October inflation print of 6.21%.  

 

The following table details sequential and annual increase in the main components in CPI (Combined):

 

	Weight	Index for November	Month-on-month change (in %)	Year-on-year change (in %)
				November	October
Cereals and products	9.67	197.3	0.9%	6.88%	6.94%
Meat and fish	3.61	224.0	(-)0.3%	4.67%	3.17%
Egg	0.43	201.4	2.8%	4.84%	4.93%
Milk and products	6.61	187.4	0.1%	2.85%	2.97%
Oils and fats	3.56	181.7	3.1%	13.28%	9.57%
Vegetables	6.04	278.7	(-)4.6%	29.33%	42.23%
Pulses and products	2.38	216.2	(-)0.2%	5.41%	7.38%
Sugar and confectionery	1.36	131.8	(-)0.1%	1.31%	2.57%
Spices	2.50	228.1	0.0%	(-)7.43%	(-)7.01%
Food and beverages	45.86	208.4	(-)0.5%	8.20%	9.69%
Pan, tobacco and intoxicants	2.38	209.2	0.1%	2.35%	2.50%
Clothing and footwear	6.53	194.4	0.3%	2.75%	2.70%
Housing	10.07	183	0.2%	2.87%	2.81%
Fuel and light	6.84	176.6	(-)0.1%	(-)1.83	(-)1.67%
Miscellaneous	28.32	186.2	0.2%	4.26%	4.32%
General Index	100	196.5	(-)0.2%	5.48%	6.21%
Consumer Food Price Index	39.06	209.8	(-)0.6%	9.04%	10.87%

 

End

 

Reported by Shubham Rana

Edited by Akul Nishant Akhoury

 

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