India's wholesale price inflation on an easing streak

This could encourage rate cuts this week.

"In a welcome sign, India’s wholesale price inflation eased for the second consecutive month in November to 7.2% y/y from 7.5% in October (Consensus 7.6%; see our India Flash for details)," said BBVA in its latest Asia Daily Flash report.

"The positive outturn was driven by a substantial softening in core inflation along with some let up in fuel prices, which offset a pick up in food inflation. Base effects, lower raw material prices and easing demand dragged core inflation to its lowest since March 2010. Looking ahead, near term upside risks to WPI inflation stem from a low base coupled with food price pressures, but we expect weak growth and favorable commodity and currency trends to contain them," BBVA added.

"Continued downtrend in the benchmark WPI inflation leaves more room for the Reserve Bank of India to consider cutting rates at its December 18th meeting. However, with retail inflation still near double digits, we expect the RBI to keep rates unchanged next week while cutting the cash reserve ratio by 25 bps to signal an easing bias and address tight liquidity conditions," it said further.

Also Read

PMI slips to 50.5 in April

Singapore, US celebrate two decades of free trade

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

I want to download the media kit