Published: Mon, October 16, 2017
Business | By Max Garcia

India's wholesale inflation cools to 2.6% YoY in September led by food

India's wholesale inflation cools to 2.6% YoY in September led by food

WPI inflation was at 3.24% in the previous month and 1.36% during the corresponding month of the previous year.

Wholesale prices climbed 2.60 percent year-over-year in September, slower than the 3.24 percent in August.

Cooling of food prices helped ease India's annual rate of inflation based on the wholesale price index (WPI) in September to 2.6 per cent, official data showed on Monday, even as industry welcomed the numbers saying it had opened room for the RBI to cut interest rates.

And inflation in vegetable prices cooled to 15.48 percent in September as against a high of 44.91 percent last month.

The index for "Manufacture of Wearing Apparel" sub-group rose by 0.1 per cent to 136.6 in September 2017 from 136.5 for the previous month due to higher price of trouser/pants made of cotton and/or mad-made fibre (2 per cent).

Whereas fuel and power group of the index registered a rise from 1.7 per cent making the figure 90.7 (provisional) from the 89.2 (provisional) figure from the previous month.

Taking a microscopic view on the data, it showed that onion prices continued to rule high, with 79.78 percent increase in September.

Prices of some manufactured items such as basic metals and semi-finished steel, however, inched up in September compared to August. However, the price of tankers declined by 1 percent. The inflation rate is still below the apex bank's medium-term target of 4 percent.

However, on a year-on-year basis, the inflation has gone up by 124 basis points from the same month last year.

Eggs, meat and fish inflation 5.47% in September compared with 3.93% lower in the previous month.

"Given the moderation in both CPI and WPI inflation, the RBI should resume the rate easing cycle in its next monetary policy announcement to give a fillip to demand".

The data further read that the build up inflation rate in the financial year so far stood at 0.97 per cent in comparison to the build up rate of 3.44 per cent in the corresponding period of the previous year.

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