Wholesale prices in India fall again in Nov

The flat reading for consumer prices followed a modest 0.2 percent rise in October and declines in August and September, the Labor Department reported Tuesday.

Over the year, overall prices rose 0.5 per cent, the largest 12-month increase since December 2014.

Over the past year, overall inflation has risen 0.5 percent while core inflation is up 2 percent.

Policy makers are expected to raise interest rates during its two-day meeting Tuesday and Wednesday.

The increase by the core index reflected higher prices for shelter, medical care, airline fares, new vehicles, and tobacco. The cost of doctor visits increased 1.1 percent, while prescription drug prices advanced 0.4 percent.

Food inflation accelerated to 6.07% in November from 5.25% the preceding month. A Reuters poll expected a fall of 2.80 percent.

On a monthly basis, output prices slid 0.2%, faster than October’s 0.1% fall.

“The latest consumer prices figures confirmed that the UK’s brief flirt with deflation came to an end in November, but price pressures look set to remain subdued for a long while yet”, Paul Hollingsworth, UK economist at Capital Economics commented.

CPIH (not a National Statistic) grew by 0.4% in the year to November 2015, up from 0.2% in October 2015.

Gasoline prices plunged by 2.4 percent, while prices for natural gas and fuel oil slumped by 1.9 percent and 1.3 percent, respectively.

The wholesale price index (WPI) declined at an annual 1.99 per cent in November, driven down by tumbling oil prices, government data showed.

The Consumer Price Index based retail inflation in October was 5 per cent – RBI’s medium-term target. Fed Chairwoman Janet Yellen and other officials have said they are looking for inflation to pick up as a sign that the economy is finally strong enough to absorb higher interest rates. Apparel prices fell 0.3%, declining for a third straight month.

USA inflation rose 0.5% in November from a year ago, matching analysts’ estimates and marking an improvement from the previous month’s 0.2% increase.

The consumer price index was unchanged vs. October as energy prices fell 1.3%.