The RBI's projection for WPI inflation for this fiscal is 5.5 per cent.
The services sector contributes the highest of around 54 per cent to the country's gross domestic product. At present, the WPI, which is released every week, contains prices of primary articles, fuel and manufactured products. Data from banking and transport services would be the first sectors to be covered on an experimental basis. The plan is to initially build a separate services index, which would be integrated into the WPI later.
Although the WPI-based inflation has been in the negative for two consecutive weeks, the Consumer Price Index, which measures movement in the prices that consumers pay, reported double-digit increase in May.
RBI expected wholesale prices-based inflation, which is near the double-digit region now, to moderate over the next few months but warned of upside risks owing to firming global commodity prices, particularly oil.
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Wholesale price-based inflation stood at 8.90 per cent in the corresponding week a year ago.
The wholesale price index-based inflation, which neared double-digit level in February, has probably peaked and was likely to decline as the country expected a good winter crop and drop in oil prices, RBI Deputy Governor K C Chakrabarty told reporters on the sidelines of a function in Bangalore on Monday.
Professional forecasters have added to Reserve Bank of India Governor Duvvurri Subbarao's dilemma on timing the exit from an accommodative monetary policy stance.
Higher prices of food products and some manufactured items pushed up inflation to 3.21 per cent for the week ended November 17, against 3.01 per cent a week ago.
The consumer price index has been in double digits for much of the past year, and was 9.8 per cent in September.
Inflation may touch the six per cent-mark by the end of this fiscal due to surging food prices and decline in agricultural output, research firm Dun & Bradstreet said.
The country's chief economic adviser Kaushik Basu had last month said he expects the hike in fuel prices to lead to one percentage point rise in inflation.
The Reserve Bank of India (RBI), in its quarterly monetary and macroeconomic review, has expressed concerns on the existing high levels of inflation rate when based on the consumer price index (CPI).
Food inflation rose for the third successive week and moved closer to 18 per cent in the week ended January 30.
Reserve Bank of India on Friday raised short-term lending and borrowing rates.
Essential items are 65 per cent costlier than last year; traders blame it on higher MSP, confusion in govt.
As it bets on a good monsoon for food prices to ease, the government on Tuesday said the Reserve Bank will consider appropriate policy actions to tighten money supply to bring down inflation.
The region witnessed a bumper potato crop of 9.5 million tonnes -- 73 per cent higher than last year's production. Wholesale prices in Kolkata crashed to Rs 300 a quintal. Retail prices, too, dropped to Rs 6-8 a kg. Farmers were forced to sell their produce at Rs 3-3.50 a kg, almost half of last year's price.
Consumer price-based index of products consumed by agricultural labourers rose to 17.21 per cent in December compared to 15.65 per cent in previous month, a Labour Bureau statement said on Wednesday. However, inflation measured by wholesale prices was 7.31 per cent in December.
The Commerce and Industry Ministry will soon seek Cabinet nod to give out inflation data every month instead of the present practice of weekly release.
Factory output in June likely rose 5.4 per cent from a year earlier, faster than the 4.7 per cent growth in May, according to a poll of 27 economists.
In the previous week inflation was (-) 1.54 per cent. Wholesale price index-based inflation was 12.53 per cent during the corresponding week a year ago.
The worst of recession could coincide with the run-up to the elections.
Top losers in the Sensex pack included M&M, SBI, Yes Bank, Asian Paints, HDFC, Tata Steel and L&T, shedding up to 2.55 per cent. The broader NSE Nifty settled 79.80 points, or 0.72 per cent, down at 10,996.10.
Inflation eased marginally to 9.59 per cent in April, but cost of some vegetables and metals remained high.
The new wholesale price-based inflation basket will have as many as 676 products, including LCD TVs, mobile phones, and packaged drinking water among others, and is likely to be rolled out in June or July.
Chief economic advisor Kaushik Basu on Thursday said that inflation may come down to 6 to 7 per cent in the next three months and that there was no need for any capital controls to check inflows as have been at a comfortable level.
As consumers wait for prices of onion to cool from Rs 50-60 a kg in retail, another important vegetable tomato continues to rule high at Rs 60 a kg in the national capital due to supply crunch as well as export of the commodity to Pakistan.
The wholesale price-based inflation stands at 9.9 per cent in March, but many analysts criticise the compilation of data, saying it includes several items that are no longer in vogue.
The wholesale price-based inflation may have moderated somewhat in March but the pressure on prices is likely to continue for another two months, Finance Minister Pranab Mukherjee on Thursday said.
While onion prices eased a little by Rs 10 a kg in Delhi on Thursday, citizens continued to be battered by high rates of other important vegetables like tomato and garlic, which are becoming out of reach for common man.
Onion prices on Thursday eased by Rs 10 to quote at Rs 60-70 a kg in the metropolitan cities of Delhi, Mumbai and Chennai, owing to an up to 52 per cent fall in wholesale prices in last three days following steps unveiled by the Centre to boost domestic supply.
The Planning Commission on said food prices will come down in the next two months easing the overall inflation, which is currently at over 8.5 per cent.
After unseasonal rains, supply disruptions and pandemic-induced woes pushed retail inflation well over the Reserve Bank's comfort zone in 2020, the scenario is likely to stay that way at least in the short term as economic recovery slowly gains foothold. For most part of this year, pricier food items pushed the retail inflation, based on Consumer Price Index (CPI), higher in the range of 6.58-7.61 per cent, except for March when the reading was 5.91 per cent. Experts believe retail inflation is likely to average around 6.3 per cent this fiscal and mostly will remain sticky going forward owing to pick-up in demand across sectors.
The WPI inflation currently is ruling around 8.6 per cent. He said the duties like 5 per cent import duty on crude oil was abolished when international crude price touched a record high of $147 a barrel.
The wholesale price-based inflation fell after rising for four consecutive weeks. Inflation was at 17.97 per cent in the previous week.
The Bharatiya Janata Party notes with dismay the fact that the consumer price inflation in India today is the highest among all the countries of Asia-Pacific.
In view of declining inflation and recessionary conditions, the Planning Commission expects industry to cut prices in the normal course to battle economic slowdown.
The wholesale price-based food inflation rose for the fourth consecutive week. In the previous week it stood at 17.94 per cent.
If the difference between provisional and final wholesale price index (WPI) numbers is taken as a leading indicator, the headline inflation rate, which is hovering around zero, is unlikely to change direction.
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