Wholesale price rise slowed down to 3.51 per cent for the week ended April 1 even though essential items like vegetables; industrial fuels and some manufactured products became costlier.
The good news on inflation continues as the wholesale price index fell for the tenth week in a row to an almost 11-month low of 5.24 per cent for the week ended January 3, prompting the Finance Ministry to project that it would go down to 3-4 per cent by March 31.
In November, wholesale prices, India's main inflation measure, rose 7.52 percent, their fastest pace in 14 months.
WPI-based inflation falls to 5-month low of 6.16%.
The government's statistical system is being overhauled with painful slowness. The base years for the indices are too far back in time, the weights for different sub-sets are out of date, the methods of data collection are defective, and the statistical methods used simplistic.
Wholesale inflation rate at five-month high in May; rupee breaches 60-a-$ mark, slides to lowest since May 5; Iraq crisis threatens to push global crude oil prices.
With the advancement of the base year and probably a revision of commodities in the index and their weights, it is expected that the index would provide a better picture of the current scenario of prices. The finance minister said information on weekly prices of manufactured products is highly meagre.
The Value Added Tax system has no adverse impact on consumer prices, and revenue earnings under the new regime have shot up by 15.3 per cent during the first quarter of the current fiscal, Finance Minister P Chidambaram told the Rajya Sabha on Tuesda
In December, the index fell a provisional 0.73 per cent.
India's year-on-year inflation rate as measured by the consumer price index rose to 3.43 per cent in January from 3.2 in December, a government statement said on Wednesday.
RBI in its policy review last month kept interest rates unchanged and said it sees an upside risk to inflation.
Costlier food items, including vegetables, pushed the October wholesale inflation to 7 per cent, the highest in the current financial year.
The Reserve Bank of India's rate-setting panel on Wednesday began its three-day deliberations on the next bi-monthly monetary policy amid expectations of at least a 35-basis-point hike in the interest rate to check high inflation. If raised, it will be the third consecutive hike in the repo rate -- the short-term rate at which the RBI lends money to banks. The central bank has already announced to gradually withdraw its accommodative monetary policy stance.
Food articles inflation dips to 8.14% from 9.50% last month.
Inflation based on the wholesale price index rose to 4.24% during the week ended October 1 from 3.97 per cent a week ago
The rise in May Wholesale Price Index based inflation has been mainly on account of 31.44 per cent increase in prices of potato, 19.40 per cent in fruits and 12.75 per cent in rice.
The Wholesale Price Index-based inflation was (-)4.54% in Sep.
Quarterly earnings from IT majors Tata Consultancy Services (TCS), Infosys, macroeconomic data announcements, global trends and trading activity of foreign investors would guide the movement in the equity market this week, analysts said. Movement of global oil benchmark Brent crude and the rupee will also influence trading in the markets. "All eyes will be on the beginning of corporate performance for the second quarter of the current fiscal year. TCS is slated to unveil its Q2 results on October 11, with HCL Technologies and Infosys following suit on October 12.
Former finance minister P Chidambaram on Friday rejected Finance Minister Arun Jaitley's contention in Lok Sabha that UPA government left behind double digit inflation.
However, prices of most agricultural items, barring potatoes, onions and wheat, continued to rise.
Hardening prices of manufactured items during the month may refrain the Reserve Bank of India from cutting rates in its policy review on February 8.
In the coming weeks prices are expected to further cool down as new crop from Karnataka has started coming into the market.
Prices of the kitchen staple in Azadpur mandi, Asia's largest wholesale market, were ruling at Rs 60 per kg today as supplies were below normal.
The retail inflation rate breached the 6 per cent upper tolerance limit of the RBI for the first time in seven months in January, while the wholesale price index stayed in double-digits for the 10th month in a row, showed two sets of data released by the government on Monday. Retail inflation, the key input for the RBI while reviewing the repo rate every two months, soared during the month mainly because of a spike in certain food items. The previous high for retail inflation was 6.26 per cent in June 2021.
Experts say given the annual inflation, the increase might not be substantial for the industry, which has to deal with rising cost of manufacturing, raw material as well as packaging and logistics.
The wholesale price-based inflation rose to 2.03 per cent in January, 2021, even as food prices cooled. The WPI inflation was 1.22 per cent in December, 2020 and 3.52 per cent in January last year. While food articles saw softening in inflation in January, manufactured items witnessed hardening of prices, as per data released by the Commerce and Industry ministry.
Food inflation, as measured by Wholesale Price Index, stood at 10.60 per cent in the previous week.
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.
His comments poured cold water on hopes that the central bank may have a rethink on rates after the wholesale price index, the main inflation gauge, rose a lower-than-expected annual 7.25 per cent in June, its slowest rise since January, helped by moderation in fuel prices.
Food inflation in April stood at 6.08 per cent, while the overall WPI inflation fell to a three-year low of 4.89 per cent.
The annual rate of inflation based on monthly wholesale price index (WPI) was up at 1.32 per cent in September as compared to 0.16 per cent in the previous month.
RBI says food supply constraints to taper off only over time.
Street expects RBI to keep CRR unchanged, opt for open-market operations to ease liquidity
Inflation, remained in negative territory for the 7th month in May
A Kotak research report expects RBI to cuts rates by 50 basis points in the first half of 2019. RBI will announce its sixth bi-monthly monetary policy on February 7.
Consumer price inflation touched a nine-month high of 11.24 per cent last month.
The market believes there will soon be another offer to buy the bonds.
Deflation masked the rise in food inflation to a 5-month high.
Inflation in food articles, fuel and power contracted in July.
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