Wholesale inflation at 23-month high of 3.55% in July | business-news | Hindustan Times
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Wholesale inflation at 23-month high of 3.55% in July

business Updated: Aug 17, 2016 01:21 IST
Press Trust of India

Vendors work at a wholesale vegetable market in Mumbai on Tuesday(REUTERS)

Wholesale inflation soared to a 23-month high of 3.55% in July as vegetables, pulses and sugar turned costlier.

The wholesale price-based inflation, reflecting the annual rate of price rise, stood at 1.62% in June. In July 2015, WPI inflation was (-)4.00 per cent.

The wholesale inflation last witnessed at a higher level than July 2016 was in August 2014 at 3.74%.

Wholesale price index (WPI) inflation in vegetables shot up by 28.05% in July, while that in pulses rose 35.76%. Potato, a daily consumable vegetable, saw the price rise during the month at 58.78%. Among others, the rate of inflation in sugar was at 32.33% and that for fruits rose by 17.30% during the month.

Overall, the food inflation basket showed double-digit inflation of 11.82%, according to commerce ministry data. All items, barring onion, in the basket showed a rising price pressure.

WPI inflation, which was in the negative zone from November 2013 to March 2016, has been firming up for the last four months.

However, deflationary trend continued in some items like onion at (-)36.29% and petrol at (-)10.30%.

The inflation print for manufactured articles read at 1.83% in July, with the rate of price rise in sugar was at 32.33%.

The WPI inflation for May has been revised upwards at 1.24%, against the provisional estimate of 0.79%.

An elevated wholesale inflation in July follows spike in retail inflation, which hit a 23-month high of 6.07%, well above the RBI’s comfortable level. In its monetary policy last week, the Reserve Bank of India (RBI) had maintained status quo on key rates, citing upside risks to 5% inflation target for March 2017.