India’s WPI inflation eases to 3.85 per cent in February

Source: Economic Times, 14 March 2023

India’s wholesale price index (WPI)-based inflation eased to 3.85 per cent in February on an annual basis from 4.73 per cent in January, stated provisional data from the Commerce Ministry on Tuesday.

The month-on-month change in WPI index for February witnessed an increase of 0.20 per cent as against 0.13 per cent in the preceding month.

“Decline in the rate of inflation in February, 2023 is primarily contributed by fall in prices of crude petroleum & natural gas, non-food articles, food products, minerals, computer, electronic & optical products, chemicals & chemical products, electrical equipment and motor vehicles, trailers & semitrailers,” stated a press release.

The latest WPI number could be favourable for corporates as a dip in wholesale prices might ease pressure on corporate earnings. Lower input costs might also bode well for retail prices.


The WPI inflation had eased to a 24-month low of 4.73 per cent in January, due to fall in prices of food articles, mineral oils, crude petroleum & natural gas, food products, textiles and chemicals & chemical products. The WPI inflation has been decreasing for the past several months.

The WPI is one of the two indices that measure inflation in India. The other is Consumer Price Inflation (CPI). The WPI captures prices at the level of production or manufacturing, taking into account goods traded between companies, as against the CPI that measures prices at the retail consumer level. Food items, which constitute a major part of the CPI, drive retail inflation, while for the WPI, it’s manufactured goods.

Yesterday, the data showed an unexpected uptick in the CPI inflation for January. It surged to a three-month high of 5.6 per cent. The spurt in retail inflation in January indicated the RBI might continue with rate hikes while the downtrend in retail inflation in previous months had raised hopes the RBI would go soft on rate hikes. Rising inflation has posed a challenge for central banks around the world which have been tightening lending rates to control it.

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