13 February 2024
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CPI inflation slows in India

Daily Outlook - February 13 2024

By Daniel Richards

CPI inflation in India slowed to 5.1% y/y in January, down from 5.7% in December and compared with the consensus forecast of 5.0%. This was the slowest pace of annual price growth since October, after which a surge in food prices drove the headline measure up once more. Food prices were up 8.3% y/y in January, a slowdown from 9.5% the previous month. In its February MPC meeting, where it held the repo rate steady at 6.5% for the sixth consecutive meeting, the RBI had highlighted the risk that ‘large and repetitive food price shocks’ posed to the disinflationary trend.

Indian industrial production data for December was also released yesterday, which surprised to the upside with y/y growth of 3.8%. This was up from 2.4% in November and exceeded the predicted 2.5% expansion. Manufacturing production was up 3.9% y/y, while consumer durables were up 4.8% and mining 5.1%.

Japan PPI inflation was 0.2% y/y in January, level with the upwardly revised (from 0.0% initially) print from December. Predictions were for 0.1% growth.

Today’s Economic Data and Events

11:00 UK ILO unemployment rate, 3months to December. Forecast: 4.0%

14:00 Germany ZEW survey, expectations, February. Forecast: 17.3

17:30 US CPI inflation, January, % y/y. Forecast: 2.9%

Fixed Income

  • USTs were largely unchanged on Monday with no data releases to drive them and some major global markets closed. All eyes are on the US CPI inflation report due today and the implications thereof for the FOMC’s rate-setting trajectory.
  • The 2yr sat at 4.4738%, down by less than 0.1bp, while the 10yr closed at 4.1793, up by less than 0.1bp.


  • There was little movement in currency markets yesterday with Asian key markets largely closed and no major data releases. The dollar index closed almost flat against its basket of peers, rising by less than 0.1ppt.
  • GBP closed almost flat at 1.2629, while EUR fell 0.1% to 1.0772. Of the commodity currencies, CAD and AUD gained against the greenback, both up 0.1% with strong consumer confidence in Australia boosting sentiment, while NZD fell 0.3% as inflation expectations fell.


  • US equity markets took a breather yesterday ahead of the CPI inflation release due today, and while there were no marked reversals on recent gains, there were some modest falls as traders took stock ahead of the news. The S&P 500 ended down 0.1% and the NASDAQ fell 0.3%, while the Dow Jones managed to close 0.3% higher.
  • Locally, the DFM closed 0.2% lower while the ADX added 0.6%.
  • Most East Asian markets were closed on Monday.


  • Brent futures prices fell back slightly at the start of the week, breaking the preceding five-day run of gains, as constructive language from Iran’s foreign minister Hossein Amirabdollahain around the conflict in Gaza tempered concerns around a spillover of unrest and reduced the risk premium that had built up over the previous week.
  • Brent futures fell 0.2% to USD 82.0/b. WTI however rose 0.1% to USD 76.9/b, capping a sixth consecutive day higher.
  • OPEC’s Monthly Oil Market Report is scheduled for release today.



Written By

Daniel Richards Senior Economist

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