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Informist, Friday, Feb. 14, 2025

 

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--India Jan WPI inflation rate at 2.31%
--Informist poll estimated India Jan WPI inflation at 2.6%
--India Jan WPI inflation rate at 2.31% vs 2.37% in Dec
--India Jan WPI food inflation at 7.47% vs 8.89% in Dec
--India Jan WPI primary articles inflation at 4.69% vs 6.02% in Dec
--India Jan WPI fuel and power inflation at -2.78% vs -3.79% in Dec
--India Jan WPI manufactured products inflation at 2.51% vs 2.14% in Dec
--India Jan WPI all commodities index down 0.45% on month
--India Jan WPI food index down 2.3% on month
--India Jan WPI primary articles index down 2.0% on month
--India Jan WPI fuel and power group index up 0.5% on month
--India Jan WPI manufactured products index up 0.1% on month
--India Jan WPI vegetable index down 22.7% on month
--India Jan WPI cereals index up 0.4% on month
--India Jan WPI edible oils index up 1.6% on month
--India Jan WPI basic metals index down 0.4% on month
--India Nov WPI inflation rate revised to 2.16% vs 1.89% provisional

 

NEW DELHI - India's WPI inflation cooled marginally to 2.31% in January from 2.37% in December despite an unfavourable base effect as a big decline in food prices brought down overall inflation, data released Friday by the commerce ministry showed. WPI inflation stood at 0.33% in January 2024.

 

At 2.31%, wholesale inflation for last month is below consensus expectations. According to an Informist poll, WPI inflation was seen rising to 2.6% in January. So far in 2024-25 (Apr-Mar), WPI inflation has averaged 2.2%. In FY24, it averaged (-)0.7%. Meanwhile, the November print was revised higher to 2.16% from the provisional estimate of 1.89%.

 

In January, the food index of the WPI was down 2.3% on month--the largest sequential fall in 16 months--with vegetables playing a key role. While the vegetable index was down 22.7% on month, that of tomato slumped 40.4%. The indices for potato and onion were lower by 19.4% and 23.5% in January from December.

 

Vegetables apart, prices of pulses were also lower in January from the previous month, although those of cereals and fruits increased. On the whole, food articles inflation fell to a five-month low of 5.88% in January.

 

Outside of food, price momentum was in the positive territory with the index for the fuel and power group up 0.5% on month. The index for manufactured products, which make up nearly a third of the WPI, inched up by a marginal 0.1%, pushing up core WPI inflation to 0.9% from 0.7% in December.

 

"Going forward, as (US) Fed decides to keep rates 'higher for longer', global demand prospects have been dented and are putting some downward pressure on oil and other commodity prices. However, based on retaliatory measures announced by countries with regard to tariffs imposed by the US, the global inflation situation will evolve. In India's case, imported inflation, due to stronger US dollar, remains a key risk but lower oil and commodity prices may help ease upside risks," said Sonal Badhan, an economist at Bank of Baroda.

 

The unexpected fall in wholesale inflation comes after the more closely tracked CPI inflation dropped more than anticipated to 4.31% in January. Headline retail inflation has now fallen by almost 200 basis points in the space of just three months, allowing the Reserve Bank of India's Monetary Policy Committee to lower the policy repo rate last week for the first time in nearly five years.

 

The following table details the sequential and annual increase in the main components of the WPI:

 

	Weight (%)	January (index)	Month-on-month change	Year-on-year change
				January	December
ALL COMMODITIES	100.00	154.7	(-)0.5%	2.31%	2.37%
PRIMARY ARTICLES	22.62	189.9	(-)2.0%	4.69%	6.02%
Food articles	15.26	199.9	(-)3.6%	5.88%	8.47%
Cereals	2.82	212.3	0.4%	7.33%	6.82%
Pulses	0.64	217.0	(-)3.1%	5.08%	5.02%
Vegetables	1.87	223.1	(-)22.7%	8.35%	28.65%
Potato	0.28	295.4	(-)19.4%	74.28%	93.20%
Onion	0.16	316.6	(-)23.5%	28.33%	16.81%
Tomato	0.28	206.3	(-)40.4%	(-)18.91%	36.16%
Fruits	1.60	196.4	1.6%	15.12%	11.16%
Milk	4.44	187.2	0.8%	2.69%	2.26%
Eggs, meat, and fish	2.40	174.7	0.0%	3.56%	5.43%
Non-food articles	4.12	167.4	0.7%	2.95%	2.46%
Oil seeds	1.12	183.0	0.1%	(-)0.05%	(-)1.35%
Minerals	0.83	230.1	0.2%	2.86%	5.47%
Iron ore	0.21	142.7	(-)0.4%	14.62%	15.10%
Crude petroleum	1.95	130.0	8.8%	(-)0.76%	(-)6.86%
FUEL and POWER	13.15	150.6	0.5%	(-)2.78%	(-)3.79%
Coal	2.14	135.6	0.0%	(-)0.44%	(-)0.44%
Liquefied petroleum gas	0.64	123.7	(-)0.7%	2.23%	2.47%
Petrol	1.60	150.8	1.1%	(-)3.64%	(-)5.09%
High speed diesel	3.10	165.6	0.6%	(-)3.61%	(-)4.30%
Electricity	3.06	149.7	0.2%	(-)4.77%	(-)4.96%
MANUFACTURED PRODUCTS	64.23	143.2	0.1%	2.51%	2.14%
Food products	9.12	177.0	0.2%	10.42%	9.68%
Edible oils	2.64	186.6	1.6%	33.10%	30.47%
Textiles	4.88	136.9	0.0%	2.16%	2.39%
Chemical, chemical products	6.47	136.7	0.2%	0.96%	0.52%
Non-metallic mineral products	3.20	131.8	0.4%	(-)1.93%	(-)3.03%
Cement and lime	1.64	130.0	0.4%	(-)5.25%	(-)6.77%
Basic metals	9.65	137.1	(-)0.4%	(-)1.22%	(-)1.43%
Semi-finished steel	1.27	116.7	(-)0.2%	(-)0.43%	(-)0.76%

 

End

 

Reported by Siddharth Upasani

Edited by Tanima Banerjee

 

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