WPI inflation to average 1.5% this year: Nomura

According to the Japanese financial services major, despite adverse base effects the Wholesale Price Index-based inflation is set to moderate further on account of lower food prices and still weak pricing power of firms.
  • Language
  • App
  • Subscriptions
  • Specials
  • Sign-In
  • Register
GeStepAhead GrowMyMoney IThe Winning Leap SME Special
Moneycontrol

Home » News » Economy

Oct 17, 2016, 04.28 PM | Source: PTI

WPI inflation to average 1.5% this year: Nomura

According to the Japanese financial services major, despite adverse base effects the Wholesale Price Index-based inflation is set to moderate further on account of lower food prices and still weak pricing power of firms.

Like this story, share it with millions of investors on M3

WPI inflation to average 1.5% this year: Nomura

According to the Japanese financial services major, despite adverse base effects the Wholesale Price Index-based inflation is set to moderate further on account of lower food prices and still weak pricing power of firms.

Post Your Comments

Share Cancel

WPI inflation to average 1.5% this year: Nomura
Inflation based on wholesale prices is expected to moderate further in the months ahead and is expected to average 1.5 percent this year, says a Nomura report.

According to the Japanese financial services major, despite adverse base effects the Wholesale Price Index-based inflation is set to moderate further on account of lower food prices and still weak pricing power of firms.

"In the months ahead, we expect WPI inflation to moderate further despite adverse base effects due to lower food prices (sowing progress and good supply management by the government) and still weak pricing power of firms," Nomura said in a research note.

In its base case, Nomura expects WPI inflation to average 1.5 percent in 2016 as against (-)2.7 percent in 2015.

Reversing its 7-month uptrend, wholesale inflation eased to 3.57 percent in September, as good monsoon helped cool food prices. In September 2015, WPI inflation was (-)4.59 percent. In August this year it stood at 3.74 percent.

"The positive WPI inflation surprise was mainly driven by a sharp moderation in food prices, while core WPI inflation was unchanged," Nomura said.

While pressure on manufacturing firms' profits likely rose due to an increase in fuel and metal prices in September.

Output prices rose, but "barley", suggesting that pricing power remains weak.

"Despite adverse base effects, WPI inflation may moderate further in the coming months due to cooling food prices," the report said.

The fall in WPI inflation prompted the industry to demand interest rate cut to boost economic activity.

Meanwhile, the RBI Governor Urjit Patel this month cut benchmark interest rates by 0.25 percent to 6.25 percent.

Buy, Hold, Sell ? Hear it first on M3
WPI inflation to average 1.5% this year: Nomura

See all

Get started using your favorite social network

or

Login using moneycontrol ID

Username
Password

Need help logging in? Reset password.

Don´t have an account? Sign Up

Get started using your favorite social network

or

Simply sign up using this short form

* mandatory

UserName*

Username should be atleast 4 character

Password*

Password should be 8 or more characters,
atleast 1 number, 1 symbol & 1 upper case letter

Alert

Your Password should contain
  • 8 or more characters
  • At least 1 number
  • At least 1 symbol
  • At least 1 upper case letter
Confirm Password*
Email
Already have an account? Login