Informist, Thursday, Nov. 14, 2024
NEW DELHI – India's WPI inflation rose to a four-month high of 2.36% in October from 1.84% in September, data released Thursday by the commerce ministry showed. The rise in wholesale inflation was led by higher food inflation and primary articles inflation. While food inflation rose to 11.59% last month from 9.47% in September, primary articles inflation increased to 8.09% in October from 6.59% in September.
At 2.36%, the WPI inflation print for October is slightly lower than the consensus expectation. According to an Informist poll, WPI inflation was seen rising to 2.5% in October. WPI inflation for August was revised slightly lower to 1.25% from the provisional print of 1.31%. WPI inflation was (-)0.26% in October 2023.
On a sequential basis, the all commodity index rose 1.0% in October, led by a 3.0% increase in the WPI food index and a 2.4% rise in the primary articles index.
Within food, wholesale prices of vegetables saw the largest sequential jump, rising 16.4% on month. The sequential rise in the vegetable index, was, in turn, led by a 68.2% on-month surge in the tomato price index. On the other hand, wholesale prices of onion and potato fell 1.6% and 0.8%, respectively on month, in October. Vegetable inflation rose to 63.04% last month from 48.73% in September.
Wholesale cereal prices also rose in October, up 1.4% on month. Pulses prices, meanwhile, declined 0.8% in October.
Manufactured products inflation rose to a three-month high of 1.50% last month from 1.00% in September. On a sequential basis, the manufactured products index rose 0.5% from September. Wholesale fuel and power inflation slipped further into the deflationary zone in October. Fuel and power inflation was at a three-month low of (-)5.79% last month from (-)1.58% in September.
Wholesale core inflation, which excludes food and fuel items, rose to 0.3% in October from a five-month low of 0.1% in September.
Despite the rise, WPI inflation remained well below headline inflation in October. Data released on Tuesday showed CPI inflation rose to a 14-month of 6.21% in October, breaching the Reserve Bank of India's tolerance range of 2-6% for the first time since August 2023.
"The WPI-food inflation print is expected to revert to sub-10% levels in November 2024, amid a favourable base, while remaining elevated in the month," Rahul Agrawal, senior economist at ICRA, said in a note. "Owing to the expected softening in food inflation, ICRA estimates the WPI inflation to ease to around 2.0% in November."
The following table details the sequential and annual increase in the main components of the WPI:
| Weight | September | Month-on-month change (in %) |
Year-on-year change (in %) | ||
| October | September | ||||
| ALL COMMODITIES | 100 | 156.1 | 1.0 | 2.36 | 1.84 |
| PRIMARY ARTICLES | 22.62 | 200.3 | 2.4 | 8.09 | 6.59 |
| Food articles | 15.26 | 218.0 | 3.4 | 13.54 | 11.53 |
| Cereals | 2.82 | 208.8 | 1.4 | 7.91 | 8.08 |
| Pulses | 0.64 | 235.5 | (-)0.8 | 9.74 | 12.99 |
| Vegetables | 1.87 | 361.3 | 16.4 | 63.04 | 48.73 |
| Potato | 0.28 | 374.8 | (-)0.8 | 78.73 | 78.13 |
| Onion | 0.16 | 478.2 | (-)1.6 | 39.25 | 78.82 |
| Tomato | 0.28 | 644.5 | 68.2 | 239.39 | 74.53 |
| Fruits | 1.6 | 210.4 | 0.5 | 13.55 | 12.17 |
| Milk | 4.44 | 185.6 | (-)0.1 | 3.00 | 3.17 |
| Eggs, meat, and fish | 2.4 | 171.0 | (-)1.0 | (-)0.52 | (-)0.80 |
| Non-food articles | 4.12 | 161.3 | (-)0.4 | (-)1.71 | (-)1.64 |
| Oil seeds | 1.12 | 185.5 | 1.0 | 2.04 | (-)1.02 |
| Minerals | 0.83 | 223.8 | (-)1.7 | 1.87 | 3.03 |
| Iron ore | 0.21 | 123.2 | (-)4.6 | 10.00 | 20.86 |
| Crude petroleum | 1.95 | 125.4 | 1.5 | (-)12.98 | (-)16.78 |
| FUEL and POWER | 13.15 | 146.5 | (-)0.3 | (-)5.79 | (-)4.05 |
| Coal | 2.14 | 135.5 | (-)0.1 | (-)0.88 | (-)0.80 |
| Liquefied petroleum gas | 0.64 | 119.8 | 2.6 | 2.57 | 13.18 |
| Petrol | 1.6 | 149.9 | (-)0.8 | (-)7.35 | (-)7.47 |
| High speed diesel | 3.1 | 164.2 | (-)0.6 | (-)6.23 | (-)5.33 |
| Electricity | 3.06 | 137.4 | 1.2 | (-)3.58 | (-)0.88 |
| MANUFACTURED PRODUCTS | 64.23 | 142.5 | 0.5 | 1.50 | 1.00 |
| Food products | 9.12 | 173.3 | 2.4 | 7.77 | 5.49 |
| Edible oils | 2.64 | 169.9 | 7.7 | 20.16 | 10.51 |
| Textiles | 4.88 | 135.9 | 0.1 | 0.89 | 1.12 |
| Chemical, chemical products | 6.47 | 136.3 | (-)0.1 | (-)0.22 | 0.07 |
| Non-metallic mineral products | 3.2 | 130.1 | (-)0.2 | (-)4.06 | (-)3.41 |
| Cement and lime | 1.64 | 128.3 | (-)0.1 | (-)7.56 | (-)6.55 |
| Basic metals | 9.65 | 139.0 | 0.4 | (-)2.25 | (-)3.15 |
| Semi-finished steel | 1.27 | 114.8 | (-)1.9 | (-)4.33 | (-)3.86 |
End
Reported by Shubham Rana
Edited by Tanima Banerjee
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