Core stays low on weak pricing power

Drop in manufacturing inflation for the fourth consecutive month reflects weak pricing power

Wholesale Price Index (WPI)-based inflation slid for the fourth consecutive month in July, printing at 0.9 per cent and driven by a continued plunge in food and fuel inflation and moderation in core inflation. Food and fuel categories have nearly 38 per cent weightage in the index.

Overall food inflation (food articles plus manufactured food) entered the negative zone to record -1.3 per cent in June compared with 0.1 per cent in May. Fuel inflation dropped to 5.3 per cent from 11.7 per cent, led by a sharp fall in global oil prices, while core inflation (measured by the CRISIL Core