India’s wholesale inflation doubles

new delhi — A major spurt in food and fuel prices in the country pushed the wholesale price index (WPI) for May to 4.43 per cent, to nearly double over the 2.26 per cent registered in May last year and higher than the 3.18 per cent recorded in April, 2018, Commerce Ministry data showed on Thursday.

Earlier this week, Central Statistics Office data showed that the consumer price index (CPI), or retail inflation, in May had touched 4.87 per cent. Citing risks to inflation mainly from rising global crude prices, the Reserve Bank of India (RBI) last week raised its key lending rate by 25 basis points to 6.25 per cent for the first time in over four years. The RBI has a median retail inflation target rate of four per cent.

The WPI Food Index increased from 0.67 per cent in April 2018, to 1.12 per cent last month. Expenses during the month under consideration on primary articles, which constitute 22.62 per cent of the WPI’s total weightage, rose by 3.16 per cent, from a fall of 1.71 per cent in May 2017. Among primary articles, food, which has a weightage of 15.26 per cent in the index, edged up last month by 1.60 per cent from a deceleration of 2.13 per cent reported for the same month last year.

The cost of fuel and power, which commands a 13.15 per cent weightage in the index, increased at a fast pace of 11.22 per cent during the month in review, from a growth of 7.85 per cent in April 2018. —