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WPI Inflation Eases to 2.47% in March

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WPI Inflation Eases to 2.47% in March
IN THE BALANCE Food prices decline 0.29% and are likely to remain moderate in the coming months
Wholesale inflation remained almost unchanged in March from the month before as a decline in food inflation offset a rise in fuel and power cost.Inflation as measured by the Wholesale Price Index (WPI) slowed to an eight-month low of 2.47% in March, compared with 2.48% in February and 5.11% a year earlier.Data released by the commerce and industry ministry on Monday showed deflation in food articles after nine months — prices shrank 0.29% in March, against 0.88% inflation in the preceding month.
CARE Ratings expects food prices to remain moderate in the coming months. “Inflationary threats, however, could emerge from: increase in international oil prices, unseasonal weather patterns and minimum support prices for select crops,” it said in a noteWholesale inflation for January was revised upwards to 3.02% from the provisional estimate of 2.84%.Retail inflation, as per data released last week, slipped to a fivemonth low of 4.28% in March on account of a decline in food prices.
Wholesale inflation in fuel and power rose 4.7% in March from 3.81% in February.Deflation in vegetables was 2.70% in March, while that in pulses was 20.58% and in wheat was 1.19%.Inflation in potatoes accelerated to 43.2% from 11.7%, but that in onion slowed to 42.2% from 119%. In the manufacturing category, having the highest weight of 64.2% in the wholesale price index, wholesale inflation remained flat at 3%.
A rise in international oil prices and depreciation of the rupee visà-vis the US dollar are expected to push inflation upwards in the coming months, said Aditi Nayar, the principal economist at ratings firm ICRA
The Economic Times, New Delhi, 17th April 2018

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