India: Inflation rises in January
Latest reading: Consumer prices were up 2.7% in annual terms in January, following a 1.2% increase in the prior month. The January release was the first since the statistical office shifted its base year for the consumer price index from 2012 to 2024, and also the first since it lowered the weight of food in the index.
Relative to the previous month’s figures, price pressures were higher for food and beverages in January (+2.1% on a year-on-year basis vs -2.7% in December).
Lastly, consumer prices rose 0.35% in January in month-on-month terms, following a 0.09% increase in the prior month.
Panelist insight: Nomura’s Aurodeep Nandi and Sonal Varma said:
“Overall, we expect FY27 inflation at 4.1% y-o-y under the new series, up 0.2pp from our current forecast of 3.9%. Relative to the old series, we see a ~0.1pp of upside in the near term, with this gap widening to ~0.2-0.5pp in H2 2026.”