Wholesale inflation tames to 0.58 per cent

Source: The Hindu Business Line, Dec 16, 2019

New Delhi: Wholesale inflation fell to 0.58 per cent in November 2019, down from 4.47 per cent in November 2018. Sequentially, wholesale inflation reported an increase, rising from 0.16 per cent in October 2019, according to a statement by the Ministry of Commerce and Industry.

The blow for consumers was softened by cheaper LPG and Crude Petroleum prices, but they had to shell out much more for expensive onions, potatoes, vegetables and cereals during November 2019.

An official statement said that the Wholesale Price Index (WPI) for all commodities for November 2019 rose by 0.10 per cent to 122.3 from 122.2 for October 2019.

In the overall index, the highest increase was reported in onion prices. The index representing onion inflation rose to 172.30 per cent in November 2019, compared to November 2018. During November 2018, the index had reported a decline of 47.60 per cent compared to onion prices in November 2017.

Since onions represent just 0.16 per cent of the WPI, the spurt could not reflect much in the overall wholesale inflation.

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November retail inflation reaches 5.54%, at 3-year high

Source: The Economic Times, Dec 12, 2019

India’s retail inflation in November rose to 5.54% from 4.62% in October, highest since 2016 and over RBI’s medium-term target of 4%.

Higher food prices contributed to the spike. Food price inflation (Rural and urban) climbed 10.01% in November.

During the month, inflation in vegetables shot up to 35.99 per cent, as against 26.10 per cent in October.

Likewise, the prices of cereals and eggs grew at a faster pace of 3.71 per cent. Prices of meat and fish rose by 9.38 per cent annually and of eggs by 6.2 per cent in November.

The share of food in headline CPI in India is at 45.9%. The rise in inflation is also due to higher food prices.

Inflation based on Consumer Price Index (CPI) was 4.62 per cent in October, and 2.33 per cent in November 2018.

Prices of onions, in particular, shot up by 45.3 per cent in September and further by 19.6 per cent in October.

Retail food prices, which make up almost half of the inflation basket, increased to 10.01% in November, compared with a 7.89 % rise in October.

Core inflation remained unchanged from October at 3.5%

The MPC in its August meeting had forecast inflation for the second half at 3.5-3.7%, which was retained in October and come December, it goes to 5.7-4.1%.

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Oct wholesale inflation at 40-month low of 0.16% on cheaper non-food items

Source: Business Standard, Nov 14, 2019

New Delhi: Wholesale inflation in October crashed to a 40-month low of 0.16 per cent, down from 0.3 per cent rise in September.

The previous low was in June 2016, when inflation was negative 0.1 per cent. Deflationary pressure on manufactured product prices, for a 12th straight month, has continued to pull down the Wholesale Price Index- (WPI)-based inflation.

In line with the trend, prices of manufactured products, which have a combined weight of 65 per cent in the index, contracted at a faster clip. Contraction stood at 0.84 per cent in the latest month, against a fall of 0.42 per cent in September. Inflation of manufactured food products, however, rose to 3.7 per cent from 3.1 per cent.

“Inflation in manufacturing is at its lowest level since April 2016. The WPI in manufactured goods was 4.6 per cent in the corresponding month a year ago. The contractionary pattern recorded in the previous two months indicates the lack of purchasing power of manufacturers. Inflation in this component has seen a decline on a sustained basis since October 2018,” Madan Sabnavis, chief economist at CARE Ratings, said.

Nine of the 17 components within the manufactured products have recorded a contraction in the latest month. Experts say the index would continue to see low growth due to the poor health of the manufacturing sector, despite a quick uptick in global commodity prices and food inflation.

The official data released on Thursday showed wholesale inflation, mainly pushed by food inflation, rose to 9.8 per cent in October, from 7.4 per cent in September. Pressure points remained in food category with cereal prices rising by 8.32 per cent in October, up from 6.24 per cent. Prices of pulses also rose by 16 per cent in October, showing a sharp reversal from the 13.5 per cent contraction in September. The rise in prices of food components to a more than five-year high limited the fall in wholesale inflation. Upside risks to wholesale food inflation is likely to emanate from post-harvest supply concerns and a low base effect, economists said.

WPI inflation eases to 0.33% in September on cheaper non-food articles

Source: Business Standard, Oct 14, 2019

New Delhi: Wholesale prices based inflation eased to 0.33 per cent in September, as against 1.08 per cent in August due to fall in prices of non-food articles, government data showed on Monday.

The annual rate of inflation, based on monthly wholesale price index (WPI), was at 5.22 per cent in September 2018.

The rate of price rise for the food articles was at 7.47 per cent during the month, while that for non-food articles stood at 2.18 per cent, showed the data released by the Ministry of Commerce and Industry.

Retail inflation spikes to 3.99% on costlier food

Source: The Economic Times, Oct 14, 2019

New Delhi: Retail inflation inched closer to the Reserve Bank of India’s medium-term target of 4% in September for the first time in 14 months on higher food prices, although economists maintain that the economic slowdown will prompt a sixth consecutive interest rate cut in December.

Wholesale inflation eased to its lowest level in more than three years. Retail inflation accelerated to 3.99% last month, data released by the statistics office showed on Monday, compared with 3.28% in August. Inflation as measured by the Consumer Price Index was 3.7% in September 2018. Read the rest of this entry »

How rural inflation is playing out

Source: The Hindu Business Line, Sept. 17, 2019

CPI Inflation in August came in at benign 3.21 per cent, although it recorded a marginal uptick from July. A deeper look at the numbers brings out the widening disparity between the urban and rural inflation.

Rural inflation in August was almost half of urban retail inflation. With the headline CPI inflation being well below RBI’s targeted 4 per cent and rural inflation too trending lower than urban, further rate cuts to boost demand and growth may be needed. Read the rest of this entry »

WPI remains unchanged at 1.08% in August

Source: The Economic Times, Sept 16, 2019

Wholesale inflation remained at 1.08% in August, the same level as the previous month, government data showed on Monday. In July, wholesale inflation as measured by the Wholesale Price Index (WPI), was at a 25-month low of 1.08%.

It was 4.62% in August last year.

Inflation in fuel and power declined 4% from a 3.64% fall in July and that in manufactured products was flat from a 0.34% growth in the trailing month. Read the rest of this entry »