New Delhi: Wholesale price index (WPI)-based inflation in India touched hit 4-month high in October. As per the data released by the Ministry of Commerce & Industry, Wholesale price index (WPI)-based inflation for October escalated to 2.36 per cent on an annual basis. In September, WPI inflation was at 1.84 per cent and in August inflation was at 1.25 per cent. In October 2023, WPI inflation was (-)0.26%. The rise in inflation for October is mainly due to higher prices in food articles, food product manufacturing, other manufacturing sectors and the production of motor vehicles.
The wholesale food inflation in October soared to double digits, coming in at 11.59%, the highest print in 28 months. This was mainly driven by a surge in prices of vegetables, oilseeds, and cereals. The inflation rate of ‘manufactured products’ increased to 1.5% in October, the highest rate in three months; while that of ‘fuel & power’ declined to a 14-month low of (-)5.79%.
Meanwhile, retail inflation in India, based on the Consumer Price Index (CPI), surged to a 14-month high of 6.21 per cent in October. India’s retail inflation had stood at a nine-month high of 5.49 per cent in the previous month of September 2024. It was at 4.87 per cent in October 2023.
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This inflation rate is beyond the RBI’s upper tolerance limit of 6 per cent. The Reserve Bank of India, which kept the key short-term lending rate unchanged earlier this month, has been tasked by the government to ensure inflation remains at 4 per cent with a margin of 2 per cent on either side.
In October, out of 21 categories within manufactured (non-food) products, only 4 categories witnessed negative print on a YoY basis, while 17 categories witnessed positive print. Categories with highest inflation rates were other manufacturing (+15.6% YoY), beverages (+2.0% YoY), and wearing apparel (+1.9% YoY). Whereas, categories with lowest inflation were other non-metallic mineral products (-3.4% YoY), basic metals (-3.1% YoY), and metal products (-2.2% YoY).
The Wholesale Price Index or WPI measures the change in prices of goods sold and traded in bulk by wholesale businesses with other companies. The Consumer Price Index (CPI) inflation tracks prices of goods and services purchased by consumers, WPI tracks factory gate prices and retail prices. Wholesale Price Index (WPI) is a measure of the average change in the price of goods at a wholesale level or in the wholesale market. Consumer Price Index (CPI) is a price index that calculates price changes of goods and services that a consumer has to pay in the retail market. The monetary police of Reserve Bank of India are made after reviewing the CPI.