Macro Shots: India Real Rural Wages Rise But… by Bandhan Mutual Fund
India’s real rural wage growth picked up to 3.8% y/y in May, from 0% in December and an average of 0.9% in 2024. However, the pickup in nominal rural wage growth has been more modest. The real wage growth has been mainly driven by the sharp drop in CPI-Rural (2.6% in May from 5.8% in December).
Nominal rural wage growth has also been driven more by agriculture, while rural non-agri wage growth has been flattish (figure above). Given good monsoon rainfall and Kharif season crops sowing this year, expectations for a pickup in the rural economy have been strong. Rural wage data from June will be important to watch.
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