India"s headline inflation accelerated in December, intensifying pressure on the government to reduce fast-rising food prices and on the central bank to tighten monetary policy, AP reported. The Ministry of Commerce said Thursday that India"s wholesale price index rose 7.3 percent in December over the previous year, jumping from November"s 4.8 percent rise and October"s revised 1.5 percent rise. As economic recovery takes root across Asia, central banks have begun to reverse monetary stimulus measures. China on Tuesday ordered banks to set aside more reserves and many economists expect the Reserve Bank of India to follow suit when it meets January 29 for its quarterly policy review. India"s weakest monsoon in four decades helped push food prices up 19.2 percent in December from a year earlier, with the cost of potatoes more than doubling and double-digit increases in essentials like cereals, rice, wheat, pulses and vegetables, according to government data. Nonfood inflation rose 7.7 percent in December, with the cost of manufactured products up 5.2 percent, the government said, suggesting that inflationary pressures have spread beyond drought-impacted farm products.
