The consumer price index (CPI) rose 1.6 per cent in September from a year earlier, the National Bureau of Statistics said yesterday, down from August’s 2 per cent.
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According to official figures, deflationary trend continued for the 11th straight month with Wholesale Price Index based inflation remaining in the negative territory at (-)4.54 per cent in September.
Eurostat figures show that Malta is the country with the highest annual inflation rates in the European Union, followed by Belgium, Portugal and Sweden, with 0.9% each.
“Inflation has remained at or around 0.0% for most of this year, and we expect that this will continue over the next few months”. The inflation rate for Fuel & Power fell further to -17.71%, the statement added. But further rate cuts are going to put renewed pressure on China to devalue its currency back to at least the CNY 6.5-6.6 level by year-end.
The slight slump in consumer inflation aggravates worries about sluggish demand in China and will encourage the government to introduce more stimulus measures, according to a Bloomberg report. The central bank, which is taking inflation into close consideration in determining the timing of an interest rate hike, said CPI was unlikely to reach one per cent until next spring.
Prices for newly built housing rose 1.6 per cent, driven by a 2 per cent increase in Auckland, where a booming property market has attracted tougher lending controls for investors from next month.
The NBS attributed part of the PPI’s decline to the falling price of oil and other commodities.
The three categories account for half of the harmonised consumer price index. “Core inflation moderate”, said chief economic advisor Arvind Subramanian.
In comparison, annual rate of inflation was minus 4.95 per cent for August 2015 and 2.38 per cent during September 2014.
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Meanwhile petrol prices are down 6.8 per cent over the past year, while private transport services dropped 24 per cent, chiefly because of a fall in the cost of motor vehicle licensing. India’s GDP growth is likely to be higher than 7.5 per cent in FY16 as compared with 7.3 per cent in FY15.
