WPI inflation for Dec 2014 'more favourable than expected': CII

CII director expressed hope that the situation will encourage the RBI to move away from what he termed as its 'inflation-centric approach' towards policy making

The Confederation of Indian Industry (CII) on Wednesday stated that the Wholesale Price Index (WPI) inflation rate for December 2014 was more favourable than expected, attributing the marginal increase of 0.11% to the rise in food prices.

"The marginal uptick in inflation, which has climbed up to a miniscule 0.11% during the month as against zero percent in November, on the back of rising food prices, is much more favourable than anticipated. The rise in food prices is attributed to the increase in prices in vegetables, fruits, pulses, onion and potatoes," CII director general Chandrajit Banerjee said.

"Going forward, the moderation of global commodity prices and the measures taken by the government to contain the inflation print would help rein in inflationary expectations and prevent inflation from making a comeback in a big way," he added.

Banerjee also expressed hope that the situation would encourage the Reserve Bank of India to move away from what he termed as its 'inflation-centric approach' towards policy making.

"The CII hopes that the conducive inflationary situation would spur RBI to move away from its inflation-centric approach to policy making and focus on rejuvenating growth in the economy and industry, in its forthcoming monetary policy," he said.

Earlier in the day, the Commerce and Industry Ministry released a statement saying that the WPI based inflation has marginally increased to 0.11% in December from zero% in November 2014.

This is in contrast to the WPI inflation in December 2013, which stood at 6.40%.