Inflation dips to 7- month low

The wholesale inflation fell to a seven- month low of 2.48 per cent in February on cheaper food articles, including vegetables. Inflation based on the Wholesale Price Index ( WPI) was 2.84 per cent in January and 5.51 per cent in February 2017.

Inflation in food articles slowed to 0.88 per cent in February from 3 per cent in the preceding month.

Inflation in vegetables softened with annual inflation at 15.26 per cent as against 40.77 per cent in January. While the rate of price rise in onion slowed, it increased in the case of another kitchen essential, potato.

“Wholesale inflation in February 2018 followed a declining trend of last two months, similar to the trajectory of retail inflation in February 2018. Decline was sharp in food articles largely due to decline in vegetables inflation,” said Dr Devendra Kumar Pant, chief economist, Ind- Ra.

He said that rising core inflation from November 2017 and highest in last 42 months suggests demand revival in the economy.

Retail inflation measured in term of Consumer Price Index had dropped to a four- month low of 4.44 per cent in February on cheaper food articles and lower cost for fuel.

ICRA’s Aditi Nayar said that with both retail and wholesale inflation recording a decline in February, the MPC is likely to keep the repo rate unchanged.