India\\\'s inflation hits 5-year low

NEW DELHI, Nov 14 (AFP): India's inflation rate has hit a new five-year low, official data showed Friday, fanning speculation the central bank could finally start cutting interest rates and spur stumbling economic growth.

Inflation as measured by the Wholesale Price Index or WPI, which contains India's biggest basket of goods, fell to 1.77 per cent in October from a year earlier -- marking a second straight five-year low -- as the fuel-import-reliant nation benefited from falling global oil costs.

The decline in India's annual wholesale inflation rate, which stood at 2.38 per cent in September, was helped by falls in prices of both oil and food, including onions -- a staple in Indian cooking. Wholesale price inflation was riding at over six per cent in May.

Businesses have been clamouring for a cut in India's steep interest rates which they say have discouraged investment and consumer spending and mired the country in its longest period of sub-five-per cent growth.

The hawkish central bank has resisted such appeals, determined to break the back of inflation, a chronic problem in India that causes misery for hundreds of millions of the country's deeply poor citizens.

The latest wholesale price data came two days after official figures showed consumer price inflation had dropped to 5.52 per cent last month, below the central bank's six-per cent goal for January 2016, and down sharply from double-digits last year.

With inflation falling faster than expected, some economists say the central bank could cut rates as early as the next monetary policy meeting set for December 2.