India: Inflation Slows Down
The growth of inflation rates is mainly promoted by the rise in prices of food, manufactured products, textiles, machinery, and equipment
A gift for Indian Prime Minister Narendra Modi, who is celebrating the first 100 days of his third term as head of government. According to preliminary data from India’s Ministry of Commerce and Industry, the Asian country’s “wholesale inflation rate” fell to 1.31% in August from 2.04% recorded in the previous month.
A press release from the Ministry of Commerce states that “the continued positive August 2024 figure is mainly caused by higher prices for food, manufactured goods, textiles, machinery, and equipment.”
Commodities rose by +2.42% on average (+3.08% in July). These include products whose prices rose by an average of 3.26% in August (+3.55% in July). In contrast, fuel and electricity went negative at -0.67% after rising 1.72% in July 2024. Prices for manufactured goods rose 1.22% in August (+1.58% in July).
India’s Bureau of Statistics earlier reported that the inflation rate, “based on the consumer price index,” rose slightly in August to 3.65% year-on-year after 3.54% in July. The trend is positive as the consumer inflation rate was 6.83% in August 2023.
Prices are rising more in rural areas (4.16%), while in urban areas the inflation rate in August amounted to 3.14%.
Indian newspapers recall that the Reserve Bank of India (RBI), the country’s central bank, has a price target of “4% with a margin more or less equal to 2%.” Prices continue to be heavily influenced by the decisions of the RBI’s Monetary Policy Committee, which on August 8 left unchanged the benchmark interest rate, the repo rate at which short-term loans to other banks are offered. The situation may be envied by the Central Bank of Russia, which on Friday, August 13, raised the prime rate from 18% to 19%.
