WPI INFLATION HITS 4MONTH HIGH OF 5.28% IN OCTOBER
Inflation-based on wholesale prices spiked to a fourmonth high of 5.28% in October mainly due to rise in fuel prices, but the Reserve Bank of India (RBI) is likely to maintain status quo in its next monetary policy review as crude prices and currency are stabilising.
The Wholesale Price Index (WPI)-based inflation stood at 5.13% in September and 3.68% in October last year.
Food articles witnessed softening of prices with deflation at 1.49% in October, against 0.21% in September, government data released on Wednesday showed.
Vegetables too became cheaper with deflation at 18.65% in October, compared to 3.83% in the previous month.
Inflation in ‘fuel and power’ basket in October spiked to 18.44%, from 16.65% in September. Individually, in petrol and diesel it was 19.85% and 23.91%, respectively, and for liquified petroleum gas (LPG) it was 31.39% during October.
The WPI inflation is in contrast to the retail or consumer price index-based inflation data released earlier this week. The October CPI inflation had cooled to a year-low of 3.31%.
ICRA principal economist Aditi Nayar said the uptick in the WPI inflation in October reflected the impact of the pass through of higher commodity prices and the rupee depreciation. The disinflation in food prices had a much smaller impact on wholesale inflation than the CPI, given the difference in weights for food items in the two indices.
The 5.28% inflation is the highest in four months, and a higher inflation than this level was last seen in June at 5.68%.
NEW DELHI: