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India’s wholesale inflation eased to an 11-month low in August as non-food and fuel inflation showed signs of softening, official data showed.

Wholesale price index-based inflation eased to 12.41% in August as against 13.93% in the previous month, data released by the ministry of commerce and industry showed on Wednesday. It is the seventeenth straight month of double-digit WPI inflation.

While the overall inflation cooled for the third straight month in August, food inflation saw an uptick during the month. With global prices for commodities and fuel starting to come down, economists expect domestic prices to cool further in the coming months.

Food articles inflation for both primary and processed categories inched up in August after showing signs of easing in the previous month. WPI Food Index, which has a nearly 25% weight in the overall index, saw inflation rise to 9.93% in August from 9.41% in July.

Primary articles inflation eased further to 14.93% in August from 15.04% in July and 18.63% in June. Under this head, food articles saw inflation rise to 12.37% during the month compared to 10.77% in July.

Economists expect the RBI-led monetary policy committee to further hike policy rates in the upcoming policy review on 30 September.

Vegetable inflation shot up to 22.29% in August from 18.25% in July, while that in the case of fruit spiked to 31.75% during the month compared to 29.44% in July. Fuel and Power inflation continued with a downward trajectory, touching 33.67% in August from 43.75% in the previous month.

Crude petroleum inflation eased to 50.57% in August from 58.77% a month ago. Inflation for diesel softened to 60.15% in August from 72.41% in the previous month and that for petrol eased to 38.68% from 55.3% last month.

The Union government had in May cut central excise duty on petrol by 8 per litre and by 6 per litre for diesel, costing the exchequer close to 1 trillion per year in revenues. Centre also imposed export tariffs on petrol, diesel, and air turbine fuel besides windfall taxes on crude production to improve domestic supplies to ease inflation and cut the need for imports and lower import bill.

India’s retail inflation, measured by the consumer price index reverted to the 7% mark in August after easing to a five-month low in July.

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