WPI inflation hits 10-month low

The wholesale price inflation (WPI) rate fell to a 10-month low of 2.76 per cent in January, official figures released on Thursday showed. The inflation rate in December had stood at 3.80 per cent, while it was 3.08 per cent in January, 2018.

The trend is in line with the consumer price inflation rate, which declined to a 19-month low of 2.05 per cent in January from 2.11 in December, according to data released on Tuesday.

Among various segments, food items saw an inflation rate of 2.34 per cent in January. These items had witnessed deflation or fall in prices for the previous six months. In December, the deflation rate was at 0.07 per cent.

On the other hand, food items continued to see a fall in prices in the consumer price index (CPI) in January, even as the deflation rate came down to 2.17 per cent from 2.65 per cent in December.

If this trend continues for a few more months, farmers might start getting reasonable prices after a long time. However, the interpretation is subject to different structures of WPI and CPI as well as the presence of middlemen.

Fuel, power and manufactured products saw the WPIbased inflation rate cooling down. It fell sharply to 1.85 per cent in January, against 8.38 per cent in December in the former owing to easing in prices of motor fuel and LPG.