New Delhi: Consumer Price Index inflation eased to 4.59% in December 2020 as compared to 6.93% in November and 7.35% in December 2019, according to data released by the Ministry of Statistics and Program Implementation on Tuesday. The rise in prices in October had been the sharpest since May 2014 when the inflation peaked to 7.61%. Retail inflation showed signs of easing in December, led by easing prices of some food items.
Food inflation declined to 3.41% in December in 2020, compared to 9.5% in the previous month.
The Index of Industrial Production contracted 1.9% in November 2020 as against revised growth of 4.2% in October 2020 and growth of 2.1% in November 2019, according to data released by the Ministry of Statistics and Programme Implementation on Tuesday.
The contraction in India’s industrial output is due to contraction in mining and manufacturing sectors. The manufacturing sector witnessed contraction of 1.7% as compared to growth of 3% a year ago, while the mining sector saw contraction of 7.3% in November 2020 as against growth of 1.9% in November 2019. Meanwhile, power generation grew 3.5%.
Inflation in India, as measured by the Consumer Price Index (CPI), has continuously been above RBI’s upper tolerance band of 6% for the past eight months until November. To be sure, inflation peaked in October to 7.61% and had fallen to 6.93% in November.
In October 2020, India’s industrial output had risen for the second straight month after six months of contraction.