Economist

Richard Iley

Macroeconomics

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<p>India's inflation rebound continued largely as expected in December. Headline CPI picked up to 5.2% y/y vs. 4.9% y/y in November; its first five 'handle' since August 2016. </p>
<p>A continued surge in vegetables inflation, which hit 29.1% y/y, was a key driver of the updraft. A combination of base effects from last December's de-monetisation induced price rout and this year's disappointing monsoon were the culprits. </p>
<p>Importantly, pulses remained in deep deflation; down -23.5% y/y. With a weight of 2.4%…</p>
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India's inflation rebound continued largely as expected in December. Headline CPI picked up to 5.2% y/y vs. 4.9% y/y in November; its first five 'handle' since August 2016. 
A continued surge in vegetables inflation, which hit 29.1% y/y, was a key driver of the updraft. A combination of base effects from last December's de-monetisation induced price rout and this year's disappointing monsoon were the culprits. 
Importantly, pulses remained in deep deflation; down -23.5% y/y. With a weight of 2.4%…


Chart of the Day: Core Revival