WPI inflation down for third straight month

NEW DELHI: India’s wholesale inflation declined in February 2018 for the third successive month, after reaching an eight-month high of 3.9 per cent in November, 2017.

Annual wholesale price inflation last month slowed to 2.48 per cent, lower than the 2.84 per cent recorded in January, 2018, and 5.51 per cent recorded in the corresponding month last year, according to data released by the commerce ministry on Wednesday.

The drop in inflation was primarily led by an insignificant rise in food and fuel prices. Wholesale food prices in February 2018 rose just 0.88 per cent from a year earlier, compared with a 3 per cent rise in January, the data showed. Prices of pulses, meanwhile, have fallen by nearly 25 per cent and of wheat by 6.23 per cent during the same period.

However, prices of vegetables continued on an upward trend, rising 15.26 per cent, though slowing down from a 40.77 per cent rise in January. Prices of onions and potatoes, two staples, grew by 118 and 12 per cent, respectively.

As a whole, primary articles, which account for more than a fifth of the WPI, grew 0.79 per cent in February, down from 4.01 per cent a year ago and 2.37 per cent in January 2018. While food prices are expected to remain stable in the coming months, risks to stable prices exist, said CARE Ratings. Some of the risks include an increase in international oil prices, unseasonal weather patterns, and a potential increase in commodity prices due to disruptions on account of any further trade tariffs.

In the fuel and power segment, wholesale inflation came down to 3.81 per cent in February from 4.08 per cent in January and 25.71 per cent in the same month the previous year. Retail inflation has also slowed in February, an earlier release showed, declining for the second straight month to 4.44 per cent.