India Economy Watch - December CPI & November IIP Below Expectations: Motilal Oswal
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Motilal Oswal Report
Consumer price index-based retail inflation came in at 5.6% YoY in December 2021 as against 4.9% YoY in November 2021. The number is slightly lower than our expectation of 5.7% YoY and Bloomberg consensus of 5.8% YoY.
With this, CPI inflation in Q3 FY22 stood at 5% YoY as compared to 5.1% in Q2 FY22 and 6.4% YoY in Q3 FY21.
Vegetables registered a six month low deflation of 3% YoY in Dec-21 as against an average deflation of 15% during July-21 to Nov-21. Excluding vegetables, CPI inflation stood at an eight-month low of 6.3% YoY in Dec-21 as compared to 6.7% YoY in Nov-21.
Separately, Index of industrial production growth in Nov-21 stood at 1.4% YoY as against 4% YoY in Oct-21 and down 1.6% YoY in Nov-20. The number was half of the consensus estimate of 2.8% and was way lower than our forecast of 4.9% YoY.
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