NEW DELHI, Jan 14 Reuters India39;s wholesale inflation accelerated in December to 2.37 yearonyear, from 1.89 in November, government data showed on Tuesday, but in line with market expectations.

The wholesale inflation rate, a proxy for producer prices, last month came largely in line with the 2.3 forecast by economists in a Reuters poll.

Food prices rose 8.89 last month, compared with an 8.92 increase in November, with vegetable prices climbing 28.65 yearonyear, marginally up from a 28.57 rise in the previous month. Cereal prices rose 6.82 in December as against a 7.81 rise a month ago.

Prices of manufactured products, which account for about 64 of the wholesale price index, increased 2.14 from a 2 increase in the previous month.

Fuel and power prices in India dropped 3.79 yearonyear, compared with a 5.8 drop in November.

Headline retail inflation, the key target for the Reserve Bank of India39;s monetary policy decisions, eased to a fourmonth low of 5.22 in December, down from 5.48 in the prior month.

The easing rate of retail inflation and a sharp slowdown in India39;s growth to a fouryear low of 6.4 in 202425 has increased pressure on the Reserve Bank of India to cut rates in its next monetary policy committee review due in February.

Reporting by Nikunj Ohri and Shivangi Acharya; Editing by Sherry JacobPhillips

Source Reuters