Impact of food inflation on headline inflation in India

consumption basket of the people are food items. Against this backdrop, in

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• The results of empirical analysis show significant causality running from headline inflation to core inflation in India and as a result, the prevalence of

consumption basket of the people are food items. Against this backdrop, in the present paper, an attempt is made to measure the second round effects stemming from food inflation in India using the measure of Granger causality in the frequency domain of Lemmens, Croux and Dekimpe (2008). The results of empirical analysis show significant causality running from headline inflation to core inflation in India and as a result, the prevalence of the second round effects. They also show that food inflation in India is not Download 0.7 Mb. Share with your friends: