Wholesale inflation rises sharply to 3.24pc in Aug

Share

India's wholesale price inflation (WPI) accelerated to four-month high of 3.24 per cent in August driven by higher prices of food and fuel products.

Build up inflation rate in the financial year so far was 1.41 per cent compared to a build up rate of 3.25 per cent in the corresponding period of the previous year, it said.

The combined index is divided into three major component indices - Primary Articles (food and non-food articles), Fuel and Power and Manufactured Products with weightage of 22.62%, 13.15% and 64.23% respectively.

The index for Primary Articles rose by 1.9 percent to 134.9 (provisional) from 132.4 (provisional) for the previous month.

Onion prices witnessed a sharp surge at 88.46 percent in August, as against a contraction of 9.50 percent in the previous month.

The index for Manufactured Products group rose by 0.2 percent to 112.9 (provisional) from 112.7 (provisional) for the previous month.

The government data released today showed that prices of food articles went up by 5.75 percent in August on a yearly basis, as against 2.15 percent in July.

More news: Mourinho confidence undimmed by Stoke road bump

According to data released by the Commerce Ministry, the annual rate of WPI inflation in July was at 1.88 per cent, while it was at 1.09 per cent during August 2016.

Vegetable prices shot up by 44.91 per cent in August, as against 21.95 per cent in July. However, the price of LPG (5%) and bitumen and petroleum coke (1% each) declined.

The last such high level of inflation was witnessed in April when the rate of price rise was 3.85 percent.

With global prices on the rise, WPI inflation in petrol and high speed diesel soared by 24.55 per cent and 20.3 per cent respectively in August. In fuel and power segment, inflation saw a surge to a near double digit inflation at 9.99 per cent, against 4.37 per cent in July.

"And with CPI inflation having also accelerated last month, we think that the central bank will refrain from loosening monetary policy any further", Shah predicted. "The localised impact of uneven distribution of rainfall on agri-production will have to be minimised through measures on the supply side including through better storage infrastructure for agri-commodities".

The reproduction of the story/photograph in any form will be liable for legal action.

Share