December’s WPI inflation print stands at 3.58%, as against 3.93% in November 2017.
New Delhi : Lower food prices pulled India’s annual rate of inflation, based on wholesale prices, to a three-month low of 3.58 per cent in December, official data showed on Monday. As per data furnished by the Ministry of Commerce and Industry, the Wholesale Price Index (WPI)-based inflation, with the revised base year of 2011-12, was 3.93 per cent in November.
However, the WPI-based inflation rate in December 2017 was higher than 2.10 per cent reported for the corresponding month of the previous year. “Build-up inflation rate in the financial year so far was 2.21 per cent compared to a build-up rate of 3.71 per cent in the corresponding period of the previous year,” the Ministry said in a statement. On a sequential basis, the expenses on primary articles, which constitute 22.62 per cent of the WPI’s total weightage, edged higher by 3.86 per cent, from an increase of 5.28 per cent in November. The prices of food articles rose by 4.72 per cent from an acceleration of 6.06 per cent in the previous corresponding month. On a year-on-year (YoY) basis, food prices in December rose by 4.72 per cent from a rise of only 0.07 per cent. In terms of individual items, onion prices soared higher by 197.05 per cent, whereas for potatoes it plunged by (-)8.40 per cent. In contrast, the overall vegetable prices in November rose by 56.46 per cent, against a fall of (-)26.88 per cent in the corresponding month a year ago.
Further, the data revealed that wheat became cheaper by (-)8.47 per cent on YoY basis and the prices of pulses came down by (-)34.60 per cent, but paddy became dearer by 3.19 per cent. On the other hand, protein-based food items such as eggs, meat and fish became expensive by 1.67 per cent during the month. Prices of the other major group under the WPI, manufactured products, which comprise nearly 64.23 per cent of the index, recorded a 2.61 per cent rise. The sub-category of manufactured food products registered a decline of (-)0.23 per cent. Fuel and power prices accelerated by 9.16 per centProduct-wise, the price of high-speed diesel rose by 12.68 per cent during December while that of petrol climbed by 8.80 per cent and for LPG by 21.14 per cent.
According to industry lobby FICCI, the moderation in WPI-based inflation “has come primarily owing to lower food prices”. “The easing of inflation is a positive sign and continued efforts of government to strengthen food supply mechanism can help in bringing down food inflation further,” said FICCI President Rashesh Shah. “As the inflation numbers are being driven largely on account of supply side factors, we urge the Reserve Bank of India to calibrate its monetary policy stance giving equal weightage to growth consideration,” Shah added.