WPI Inflation Eases But Remains In Double Digits For Tenth Straight Month
India’s wholesale inflation as manufactured good prices rose at a slower pace than last month.
India’s wholesale inflation eased as prices of manufactured product rose at a slower pace than in the previous month.
Inflation, as measured by the Wholesale Price Index, stood at 12.96% in January 2022 against 13.56% in December, according to data released by the Ministry of Commerce and Industry on Monday. That’s the tenth straight month of double-digit print.
The gauge rose 0.35% over the previous month compared with a 0.9% decline in December.
Twenty-four economists polled by Bloomberg had pegged the wholesale inflation at 12.7%.
Despite the moderation bringing partial relief to the WPI inflation trajectory, the double-digit year-on-year print continues to reflect the inflationary pressures in the manufacturing and the services sector, said Suman Chowdhury, chief analytical officer at Acuité ratings.
WPI core inflation, however, is estimated to have further moderated to 9.7% year-on-year in January from 11% in December, with a sequential rise of 0.56% compared to 0.31% in the previous month, Chowdhury said.
According to Aditi Nayar, chief economist at ICRA, the initial index for crude oil for January 2022 is sure to undergo a lagged upward revision, which will push up the revised WPI inflation to 13%. The continuous hardening in crude oil prices exacerbated by the ongoing geopolitical concerns, and its impact on the rupee, poses the biggest risk to the WPI inflation trajectory in the ongoing quarter, she said.
WPI Inflation Internals (Year-On-Year)
Inflation in manufactured products—the largest component of the index—stood at 9.42% compared with 10.62% in December.
Primary articles inflation stood at 13.87% compared with 13.38% in the previous month.
Inflation in food articles was at 10.33% against 9.56% in the previous month.
Vegetables inflation stood at 38.45% compared with 31.56% in December.
Inflation in non-food articles was at 19.68% against 19% in December.
Fuel and power inflation stood at 32.27% against 32.3% in December.