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   Retail inflation rises by 9.90 pc in November
   New Delhi, December 12, 2012: Rising for the second consecutive month, retail inflation surged 9.90 per cent in November driven mainly by rising prices of food items such as sugar, vegetables, edible oil and clothing. The retail inflation was 9.75 per cent in October and 9.73 per cent in September.
  The highest price rise in November was seen in the oil and fats segment with an annual inflation of 17.67 per cent, as per the Consumer Price Index (CPI) data released on Wednesday. Further, sugar turned expensive by 16.97 per cent, and pulses became dearer by 14.19 per cent on an annual basis. Vegetable rates during month increased by 14.74 per cent, while rates of meat, fish and egg rose by 11.33 per cent.
  At the same time, clothing and footwear also witnessed an increase in prices at 11.08 per cent in November. In urban areas, retail inflation rose to 9.69 per cent in November, from 9.46 per cent in the previous month. However, CPI moderated for rural population to 9.97 per cent during the month from 9.98 per cent in the previous month. The highest price rise in November was seen in the oil and fats segment with an annual inflation of 17.67 per cent.
  All India provisional General (all groups) CPI numbers of November 2012 for rural, urban and combined are 126.9, 123.4 and 125.4, respectively. The increase in the retail inflation to near double-digit would be taken into account by the Reserve Bank when it comes out with its mid-quarter policy review next week. WPI inflation for October was at 7.45 per cent, much higher than the RBI comfort level of 5-6 per cent. Concerned over the persistent inflation, the Reserve Bank had in October kept benchmark interest rate unchanged. Meanwhile, industrial output growth rate bounced back to 8.2 per cent in October compared to a 5 per cent contraction in the same month last year. 

   India Inflation Slows to 7.45% in October
NEW DELHI, November 14, 2012: Inflation in India slowed to its weakest rate in nine months in October, taking some pressure off the central bank to keep interest rates high and opening the door to a rate cut early next year. The wholesale price index rose 7.45% in October from a year earlier as food prices cooled, down from September's 7.81% rise, government data showed Wednesday. The reading was lower than the 7.90% median estimate in a Dow Jones Newswires poll of 17 economists. "The inflation numbers are showing signs of moderation," said R. V. Kanoria, president of the Federation of Indian Chambers of Commerce and Industry. "This should encourage the [Reserve Bank of India] to
fine-tune monetary policy with a view to bolstering growth, particularly of the manufacturing sector."
   India's economy grew just 5.5% in the April-June quarter, close to the prior quarter's nine-year low of 5.3%. Data earlier this week showed an unexpected contraction in industrial output, even as India's trade deficit expanded in October to its widest level in several years. Still, the central bank may opt to keep its policy rates steady at its Dec. 18 meeting, choosing to wait another month to be sure that inflation is trending lower.
  The RBI so far has resisted the pressure. Since it last cut rates—by half a percentage point in April—it has held steady four times, citing high prices of manufactured products and rising rural wages. At its most recent policy review Oct. 30, however, the bank indicated that it might cut in the first quarter of 2013, when it expects inflation to begin easing significantly. India's wholesale price inflation has averaged 7.60% since December 2011, despite the RBI's tight monetary stance. That is mainly due to a sustained increase in prices of farm commodities and rising consumption as Indians grow more prosperous, but loose fiscal policy has added to demand pressures and diluted the central bank's efforts.
  Consumer inflation has also been on the rise, edging close to double-digit levels. Data on Monday showed consumer price inflation in October accelerated slightly to 9.75% on-year from 9.73% in September. Source: WSJ India

  September inflation at 7.81% as fuel prices jump
MUMBAI, October 15, 2012: India's wholesale price index (WPI) rose a faster-than-expected 7.81% in September from a year earlier, mainly driven by higher fuel prices, government data showed on Monday. Indian inflation rose to the highest level in 10 months in September, limiting the central bank's ability to cut rates to help support the slowing economy. The wholesale price index rose 7.81% in September from a year earlier due to a rise in fuel prices, government data showed Monday. It rose 7.55% in August. The September reading was slightly higher than the 7.75% median estimate in a poll of 16 economists. The government revised up July's inflation print to 7.52% from 6.87% reported earlier.
  The acceleration in inflation comes after the government last month raised state-set prices of diesel by 14% to help rein in New Delhi's gaping fiscal deficit. The move was expected to drive up headline inflation in the subsequent months. After the inflation figures were released Monday, the benchmark 8.15% 2022 bond slipped to 99.85 rupees from 99.91 rupees beforehand. The inflation results complicate the Reserve Bank of India's task. It will have to decide between cutting rates and risk stoking inflation or keeping rates steady to hold prices down even though that may push Asia's third-largest economy deeper into a slowdown.
  The inflationary situation has worsened due to the diesel price increase and sharp gains in major primary article prices, said Rupa Rege Nitsure, chief economist at Bank of Baroda. "Given that growth has also slowed significantly, the RBI is likely to reduce the CRR [cash reserve ratio] further but not touch the policy rates on Oct. 30" Ms. Nitsure added. Oct. 30 is the date of the next policy board meeting.

   Inflation creeps up 7.55 per cent in August
New Delhi, September 15, 2012: The WPI (wholesale price index)-based headline inflation has crept up to 7.55 per cent in August from 6.87 per cent in July owing to rising prices of food items as well as manufactured goods. Even as the bold reform measure aimed at partly rationalising fuel subsidies will put an additional burden on the common man, economists and apex industry chambers, in particular, have hailed the step as the government’s first initiative towards fiscal consolidation while hoping against hope that the Reserve Bank of India (RBI) would do its bit to boost investment and growth by easing key policy rates on September 17.
  However, even though the overall inflation in August this year is well below the level of 9.78 per cent that prevailed in the same month of 2011, the apex bank is unlikely to oblige India Inc in view of the continuing inflationary expectations, and the cascading effect of higher diesel prices to the extent of about 80-100 basis points. The WPI inflation data for August revealed that even as food inflation eased marginally to 9.14 per cent in August from 10.06 per cent in the previous month, the worrying factor is that manufacturing or core inflation, which had shown a down trend in previous months, also inched up to 6.14 per cent from 5.58 per cent in July on account of higher prices of cotton textiles, paper and paper products, cement and lime. Admittedly, with transportation costs going up in the days ahead following the over Rs. 5 per litre hike in diesel prices, a spike in the prices of food articles as well as manufactured goods starting from steel and cement to consumer goods is a certainty although the intensity is likely to vary depending on the absorption capacity of the producing units. 
  As per the WPI data on food articles, pulses turned dearer by 34.39 per cent while wheat and cereal prices went up by 12.85 per cent and 10.71 per cent, respectively, in August on a year-on-year basis.Meanwhile, headline inflation for June was revised up to 7.58 per cent from 7.25 per cent.

   Inflation declined to 6.87 per cent in July 

   Delhi, August 14, 2012: Inflation declined to 6.87 per cent in July, mainly driven by higher food prices, government data showed on Tuesday. Inflation, as measured by the Wholesale Price Index was 7.25 per cent in June as prices of manufactured items eased a little, although vegetables, wheat and pulses became costlier. It was 7.55 per cent in May. In June 2011, it was 9.51 per cent. 
;  Reserve Bank Governor D Subbarao had said in July that the inflation numbers on both the wholesale and retail front are way above the central bank's comfort level. Subbarao said, "We are way above the threshold" and a level of around 5
per cent on the headline inflation is the RBI's threshold. On July 31, Reserve Bank of India left key interest rates unchanged to fight inflation. The key lending (repo) rate, at which banks borrow from RBI, has been retained at 8 per cent despite demands from the industry to cut interest rates to spur economic growth. The Cash Reserve Ratio (CRR) - the amount of deposits banks keep with RBI in cash - has also been retained at 4.75 per cent.

   June inflation slows to 7.25 percent
NEW DELHI, July 16, 2012 (Reuters): India's headline inflation slowed to its lowest level in five months in June. The wholesale price index (WPI) - India's main inflation gauge - rose an lower-than-expected annual 7.25 percent in June, its slowest rise since January, following a drop in prices of some fuel items. Wholesale prices rose 7.55 percent in May. Businesses want lower interest rates to help drag Asia's third largest economy back from a nine-year low of 5.3 percent GDP growth in the first quarter of 2012. But a faltering monsoon, key to volatile food prices, tempered expectations of a rate cut, with the government warning inflation could accelerate without more rain.
  The government bond yields and overnight index swaps (OIS) rates fell after Monday's data, but the rupee and stock market flattened after an initial bump, as traders calculated that at around 4.9 percent, core inflation was too high to significantly increase chances of a rate cut at the Reserve Bank of India's July 31 policy meeting. "I do not expect this number to prompt the RBI to immediately cut rates," said Shubhada Rao, Chief Economist at Yes Bank in Mumbai. "The inflation expectation still remains elevated, and the outlook is cautious because of the performance of monsoon, and its impact on food prices, as well as the impending and much awaited hike in fuel prices."
  Food prices, which rose 10.81 percent in June from a year earlier, up from 10.74 percent in May, have been mainly responsible for India's long struggle with inflation. "If the monsoon turns out to be different from our expectation then it can push up inflationary expectation, then inflation can go up. Therefore, much depends on it," warned the prime minister's economic advisor C. Rangarajan. Annual fuel inflation was 10.27 percent in June, down from 11.53 a year earlier. A weak Indian rupee has largely offset falling global crude prices and prevented fuel inflation slowing further.

  Inflation rises to 7.55% in May

  New Delhi, June 14, 2012 (PTI): Inflation moved up to 7.55 % in May because of a spurt in prices of potato, pulses and wheat, although onion and fruits showed a declining trend. Inflation, as measured by the wholesale price index (WPI), was 7.23 per cent in April. In May last year, it was 9.56 per cent. Overall food inflation rose to 10.74 per cent in May, from 10.49 per cent in April. Food articles have a 14.3 per cent share in the WPI basket. Potatoes turned costlier by 68.10 per cent during May on annual basis. For April, the rate of price rise was 53.44 per cent. Besides, pulses and wheat turned expensive by 16.61 per cent and 6.81 per cent respectively. However, vegetables inflation was lower at 49.43 per cent in May. In April, the rate of price rise was 61 per cent. Besides, eggs, meat and fish prices rose 17.89 per cent during the month, slightly higher than 17.54 per cent in April. Inflation in milk was 11.90 per cent, while rice and cereals turned costlier by 5.07 per cent and 5.73 per cent respectively. Onion prices declined by 7.23% in May, against 12.11 per cent in April. Non- food manufactured inflation showed some easing and was 5.02 % in May. It was 5.12% in April.
  The headline inflation number for March was revised upwards to 7.69 per cent, from the provisional estimate of 6.89 per cent. Inflation in overall primary articles crossed double digits to 10.88 per cent in May, from 9.71 per cent in April. Inflation in non-food primary articles, which include fibres and oilseeds, increased sharply by 8.47 per cent in May. In April, it was 1.61 per cent. In the 'fuel and power' segment, inflation rose by 11.53 per cent on an annual basis. The rate of price rise was 11.03 per cent in the previous month. Oilseed prices shot up by 19.18 per cent in May. The rate of price rise was 16.66 per cent in April.
  On year-on-year basis, among manufactured items, iron grew dearer by 14.93 per cent, while edible oil prices rose by 10.53 per cent. Inflation in tobacco products and basic metals was 7.80 per cent and 10.31 per cent respectively. Experts said the inflationary pressure, driven by prices of food articles, will keep the pressure on the government to remove supply side bottlenecks. Overall inflation hovered at double digits for most of 2010 and 2011. The Reserve Bank of India RBI) increased key policy rates 13 times, totalling 350 basis points, between March 2010 and October 2011 to tame inflation. Since January, RBI has been injecting liquidity into the financial system, by reducing the cash reserve ratio for banks. Besides, it has called for fiscal steps by the government to combat inflation. In its annual monetary policy last month, RBI cut key lending rate by 50 basis points to lower borrowing costs amid falling industrial and economic growth. RBI has projected inflation to be around 6.5 per cent by March 2013, with a caution that there is need to arrest the decline in economic growth.

   Inflation falls to 6.89 percent in March

  New Delhi, April 16, 2012 (IANS) Inflation declined marginally to 6.89 percent in March as compared to 6.95 percent in the previous month even as prices of vegetables, pulses and milk rose sharply, adding to the Reserve Bank of India's dilemma over rates cut in the annual monetary policy Tuesday. The monthly wholesale price index data released by the ministry of commerce and industry Monday showed that inflationary pressure continued in the system.
  Prices of vegetables surged by 30.57 percent year-on-year in the month under review, milk became costlier by 15.29 percent, pulses became dearer by 10.05 percent and prices of egg, meat and fish rose by 17.71 percent. However, onion, fruits, wheat, fibres and non-food articles became cheaper during the last month of 2011-12 when compared to the price of these items in the corresponding month of previous year.
  The government revised upward the January inflation data to 6.89 percent as compared 6.55 percent announced earlier.
Build-up inflation in 2011-12 was 6.89 percent as compared to a build up of 9.68 percent in the previous year.  Manufactured products, which have almost 65 percent weight in the Wholesale Price Index (WPI), showed moderation in prices. Inflation in manufactured products moderated to 4.87 percent in March as compared to 5.75 percent in the previous month. Industrial output grew by lower than expected 4.1 percent in February, according to official data released last week. Continued inflationary pressure and lower than expected growth have added to the dilemma of the central bank. It is widely expected that the Reserve Bank of India would lower policy rates by 0.25 percent Tuesday in its monetary policy for 2012-13. The RBI has not cut rates in the last three years.

  Inflation based on Consumer Price Index at 7.65% in January

  New Delhi, february 21, 2012 (PTI): Inflation based on the all India Consumer Price Index stood at 7.65% in January, as per the first nationwide retail inflation data released by the government today. While 'food and beverages' reported a moderate rate of price rise of 4.11% year-on-year in January, the inflation numbers for fuel and light, and clothing, bedding and footwear segments were in double-digits. Overall retail inflation in rural and urban areas stood at 7.38% and 8.25% in January, respectively.
  "There was a long pending demand of ministries and various users for a comprehensive consumer inflation rate. To meet this demand, annual inflation rates based on this broad based CPI series for January 2012 are released today," Minister of State (Independent Charge) in the Ministry of Statistics and Programme Implementation Srikant Jena said. The all India CPI will be in addition to the three retail price indices -- for agricultural labourers, rural labourers and industrial workers --prepared by the Ministry of Labour.
  The new nationwide CPI is being prepared by the Ministry of Statistics and Programme Implementation (MOSPI) and is eventually expected to replace the Wholesale Price Index (WPI) as the benchmark inflation. Vegetables were cheaper by over 24% on a nationwide basis in January over the same month last year. However, other f od and beverages reported a rise in prices. In rural and urban areas, inflation in the category stood at 4.18% and 3.98%, respectively. Milk and milk products became 16.53% more expensive on an annual basis, while price of oils and fats went up by 13.47% in January. Condiments and spices became dearer by 11.83% and fruits by 10.62% in the month.  

  Food inflation turns negative -1.03% on January 27, 2012