As per the latest data released by the Federal Bureau of Statistics CPI inflation in Jun’10 has clocked in at 12.7%YoY, falling from 13.1%YoY in May’10. This was against our forecast of 12.9%YoY for Jun’10. The primary components of the Consumer Price Index i.e. Rental (HRI) and Transport inflation – combined weight of ~31% in the Consumer Price Index – declined to respective levels of 9.7%YoY and 15.8%YoY in Jun’10 from 10.5%YoY and 18.7%YoY, respectively in May’10. Wholesale Price Index (WPI) inflation, which in our view is a leading indicator of the movement in the CPI, also depicted a healthy drop of 3.6% in Jun’10 compared to May’10.
AKD Research
13 July 2010