Retail inflation eases to 4.59% in December; IIP contracts 1.9% in Nov

Consumer Price Index (CPI)-based inflation eased to 4.59 per cent in December 2020 compared to 6.93 per cent in November, according to government data released Tuesday. Food inflation declined to 3.41 per cent in December, compared to 9.5 per cent in the previous month.

Meanwhile, the Index of Industrial Production (IIP) contracted by 1.9 per cent in November as against 3.6 per cent growth in October, according to data from the Ministry of Statistics and Programme Implementation. The manufacturing sector output shrank by 1.7 per cent in November, while while power generation grew 3.5 per cent. Mining output saw a decline of 7.3 per cent. 

Inflation in India, as measured by the CPI, has continuously been above the central bank’s limit of 6 per cent for the past eight months until November. The rise in prices in October had been the sharpest since May 2014 when the inflation rose to 7.61 per cent. The easing of inflation in December was led by lower prices of some food items.