Asequential easing prices of tomatoes and onions post the festive season, led to the cost of thali declining nearly 4% in December, according to a Crisil report. While the cost of non-veg thali declined 5% in December to Rs 57.6 from Rs 60.4 in the previous month, the cost of veg thali was down 3% to Rs 29.7
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However, compared to the previous year veg thali prices were still up 12% in December.
“The rise in veg thali cost was led by substantial increase of 82% and 42% in prices of onion and tomato, respectively. Prices of pulses, which account for ~9% of the veg thali cost, also increased 24% on-year,” Crisil said.
A rise in prices of onions and tomatoes and sticky inflation in pulses and cereals had pushed inflation to 5.6% in November. Experts indicate that inflation is likely to be high in December as well and continued pressure on crops could keep food prices elevated for the rest of the year.
Food inflation had risen to 8.7% in November, compared with 6.6% in the previous month, with cereal inflation recording double-digit increase for a fifteenth consecutive month and pulses registering double-digit rise for sixth straight month.
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Vegetables had recorded a 17.7% rise in inflation in November. Broiler prices, which account for nearly 50% of the non-veg thali cost were down 15% compared to the previous year. Inflation is expected to hover around 6% mark, according to experts.
“We estimate that CPI inflation rose modestly in December to 5.6% y/y, up from 5.55% in October, driven higher mostly by unfavourable base effects, even as CPI declines 0.41% m/m nsa,” said Rahul Bajoria, MD & Head of EM Asia (ex-China) Economics, Barclays.
“ Food inflation likely rose in y/y terms due to a low base, while lower fuel and core inflation should offset the rise to some extent,” he further added.
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India will release inflation numbers for December on January 12.
