Indian inflation drops to 11-month low in December

  • Indian inflation slowed to an 11-month low in December, raising hopes of an interest rate cut when the central bank meets later this month.

    The annual rate of inflation eased to 7.18 percent last month, down from 7.24 percent in November, according to the Wholesale Price Index.

    The slight drop continues the downward trend that began in October.

    The Reserve Bank of India (RBI) is to meet on January 29 to look at interest rates.

    The RBI has not lowered interest rates since April because inflation, driven by a weaker rupee and more expensive oil imports, has remained above 7 percent.

    Meanwhile, economic growth has been slowing since last year, dropping to an annual pace of 5.3 percent in the July to September quarter. Economists believe a a rate cut could help to boost the economy.