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WPI inflation rises to 3.18% in April on costlier fuel, fruits

15 May 2018

A vendor loads tomatoes in a bag for a customer at a wholesale vegetable market in Mumbai, March 14, 2018.

Coming back to the April data, annual wholesale price inflation (WPI) last month also rose to 3.18 per cent from a year earlier, higher than a 2.47 per cent rise in March, as revealed by the government data released on Monday.

Consumer food price inflation, a metric to gauge changes in monthly kitchen costs, grew 2.80 percent in April from 2.81 percent in March as compared with 0.61 percent growth a year ago. "Given that the latest IIP (index of industrial production) data showed some easing, we believe that the monetary policy committee is likely to maintain status quo in June's meeting and is likely to wait out further prints to assess such statistical effects while making adjustments", Richa Gupta, senior director and senior economist, Deloitte India, said.

On a sequential basis, the expenses during the month under consideration on primary articles, which constitute 22.62 per cent of the WPI's total weightage, rose by 1.41 per cent, from a marginal rise of 0.24 per cent in March 2018.

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Data on retail inflation is scheduled to be released later in the day.

"Break down of the WPI data for April, 2018 shows annualised inflation of close to 10 per cent for petrol and over 13 per cent for high speed diesel". RBI mainly takes into account retail inflation data while formulating monetary policy.

The CPI index had been declining since January this year. However, the price of egg (4%), ragi and gram (3% each), moong, betel leaves and poultry chicken (2% each) and urad, barley, beef & buffalo meat, rajma, arhar, fish-inland and condiments & spices (1% each) declined.

Deflation in vegetables was 0.89 per cent in April, while in the previous month it was 2.70 per cent.

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Inflation for fuel and power segment came at 7.85% in April as compared to 4.70% for the previous month. Core CPI inflation remained high at 5.9 per cent in April as against 5.3 per cent in March.

India's annual wholesale price inflation picked up in October to a six.

On WPI, Aditi Nayar, Principal Economist with ICRA said that inflation is expected to continue to rise over the remainder of this quarter.

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WPI inflation rises to 3.18% in April on costlier fuel, fruits