Wholesale inflation in March drops to 29 month low at 1.34%

According to data released by Ministry of Commerce and Industry, India's wholesale inflation cools further in March at 1.34 per cent hitting the lowest figure in 29 months. The fall comes days after Ministry of Statistics and Programme Implementation on April 12 said that retail inflation fell to a 15-month low of 5.66 per cent in February.

WPI inflation in February had come down to 3.85 per cent and in March 2022 it was at 14.63 per cent.

March is the 10th straight month when wholesale price index (WPI) based inflation has declined.

Food inflation

Inflation in food articles, however, rose to 5.48 per cent in March as against 3.81 per cent in February. "Decline in the rate of inflation in March 2023 is primarily contributed by fall in prices of basic metals, food products, textiles, non-food articles, minerals, rubber & plastic products, crude petroleum & natural gas and paper and paper products," the commerce and industry ministry said on Monday.

Inflation in wheat and pulses was 9.16 per cent and 3.03 per cent, respectively while in vegetables it was (-)2.22 per cent. Inflation in oilseeds was (-)15.05 per cent in March 2023.

But the overall price momentum was very minute as the all-commodity index of the WPI remained unchanged in March from February despite two of the major groups posted sequential declines.

Fuel, power and manufacturing index

The fuel and power index in March were 1.3 per cent lower from February and manufactured products dropped 0.3 per cent. But the 1.2 per cent month-on-month gain in the index of primary articles nullified the two downward movements.

The biggest sequential price gainers in the primary articles were minerals at 8.2 per cent, crude petroleum at 6.8 per cent, vegetables at 5.5 per cent and fruits at 3.8 per cent.

Repo rate

Earlier this month the Reserve Bank of India's Monetary Policy Committee decided to leave the repo rate unchanged at 6.5 per cent despite expectations of a 25 bps rate hike.

With inputs from Agencies