Photographer: Dhiraj Singh/Bloomberg

Wholesale Inflation Slows as India Cash Ban Damps Food Costs

India’s wholesale inflation slowed more than estimated in the first full month following Prime Minister Narendra Modi’s clampdown on cash, as food prices plunged.

Wholesale prices rose 3.39 percent in December from a year earlier, the Commerce Ministry said in a statement in New Delhi on Monday. The median of 23 estimates in a Bloomberg survey of economists had predicted a 3.5 percent increase. Data last week showed that the benchmark consumer-price gauge eased to a two-year low as demand slumped.

Food costs fell 0.7 percent in the wholesale index and the increase in retail prices slowed to 1.4 percent from November’s 2 percent gain. A slump in consumption would boost pressure on Modi to include stimulus measures when his administration presents its budget Feb. 1.

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