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Business News/ Economy / WPI inflation eases to 12.41% in August

WPI inflation eases to 12.41% in August

Wholesale price-based inflation (WPI) eased to 12.41% YoY from 13.93% in the previous month of July

The Wholesale Price Index (WPI)-based inflation eased in augustPremium
The Wholesale Price Index (WPI)-based inflation eased in august

India's wholesale price-based inflation (WPI) eased to 12.41% year-on-year (YoY) in August 2022 from 13.93% in the previous month of July, the government data showed on Wednesday, and lower than 11.64% in August 2021.

Inflation in August, 2022 is primarily contributed by rise in prices of mineral oils, food articles, crude petroleum & natural gas, basic metals, chemicals & chemical products, electricity, food products etc. as compared to the corresponding month of the previous year, as per data released by the ministry of commerce and industry.

August is the 17th consecutive month of double-digit WPI, which had touched a record high of 15.88 per cent in May, this year. In the fuel and power basket, inflation was 33.67% in August, as against 43.75% in July. In manufactured products and oil seeds it was 7.51% and (-) 13.48%, respectively. The rate of price rise in vegetables was 22.29% during the month under review, as against 18.25% in July.

The Food Index consisting of 'Food Articles' from Primary Articles group and 'Food Product' from Manufactured Products group have increased from 174.4 in July, 2022 to 176.0 in August, 2022. The rate of inflation based on WPI Food Index increased from 9.41% in July, 2022 to 9.93% in August, 2022.

Meanwhile, India's retail inflation quickening to 7% after cooling to a five-month low in July. The increase, led by food prices, made it the eighth month that retail inflation stayed above the central bank’s upper tolerance limit of 6%.

Inflation is expected to remain elevated over the next couple of months due to last year’s low base, even as easing energy and commodity prices globally would help cool inflationary pressures. 

The Reserve Bank of India (RBI) mainly looks at retail inflation to frame its monetary policy. RBI’s monetary policy committee (MPC) raised the repo rate by 50 basis points for the third time in a row in August, taking the policy rate to pre-pandemic levels of 5.4%. The MPC meets again from 28 to 30 September.

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Published: 14 Sep 2022, 12:42 PM IST
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