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July wholesale inflation eases to 5-month low of 5.19 percent

Posted on Aug 14 2014 | IANS

New Delhi, Aug 14 : India's wholesale price inflation in July eased to 5.19 percent compared to 5.43 percent in the previous month, aided by a moderation in fuel costs, government data showed Thursday.

The wholesale price index (WPI) was at 5.85 percent during the corresponding month of the previous year.

The build up inflation rate in the current fiscal was 2.38 percent compared to a build up rate of 3.17 percent in the corresponding period of the previous year, a commerce and industry ministry statement said here.

Consumer price (CPI) inflation, conversely, accelerated to a two-month high of 7.96 percent in July against 7.46 percent in June, pushed up by rising prices of vegetables, fruit and milk.

Consumer food price inflation under a new series published by the government jumped in July to 9.36 percent from 7.97 percent in the previous month.

Where WPI inflation came down, wholesale food inflation rose to 8.43 percent in July from 8.14 percent in June.

While food items constitute over 45 percent weight in CPI, their weight in WPI is a much lower 14.34 percent.

Primary articles, which have weightage of 20.12 percent in the WPI, rose by 2.7 percent in the month under review from an increase of 6.84 percent in June.

Fuel and power, which have a weightage 14.91 percent in the index, declined by 7.04 percent in July from 9.04 percent percent in June.

Liquefied petroleum gas (LPG) prices, however, jumped by 8.90 percent in July as compared to 6.74 percent in June.

According to data released by the ministry, food inflation which has a weightage 14.34 percent in the index grew by 8.43 percent in July from 8.14 percent in June.

The sticky food inflation situation has given a setback to expectations of the Reserve Bank of India easing key lending rates in its next monetary policy review.

Prices of potein-based food items like pulses rose by 3.31 percent, though egg, meat and fish became dearer by just 2.71 percent.

Fruits became costlier by 31.71 percent in July against 21.70 percent in June, while vegetable prices price decelerated by 1.27 percent in July compared to a 5.89 percent fall in June.

Potato prices zoomed by 46.41 percent year-on-year against 42.52 percent in June. However, onion prices fell by 8.13 percent against a decline of 10.70 percent over this period

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