WPI inflation dips to 2.6% in September 2017

Core WPI inflation moves up to 35-month high of 2.8% in September 2017

The Wholesale Price Index (WPI)-based inflation, base year 2011-12, dipped to 2.6% in September 2017 after rising sharply for last two months. The WPI inflation decline was driven by fall in inflation for two major sub-groups - primary articles and fuel products, while the manufactured products group has exhibited an increase in inflation in September 2017. Core inflation (manufactured products excluding foods products) increased to 35-months high of 2.8% in September 2017 from 2.6% in August 2017.

Inflation of primary articles dipped to 0.2% in September 2017 from 2.4% in August 2017. The inflation for fuel items also eased to 9% in September 2017 from 10% in August 2017, while snapping sharp increase for previous two straight months. The inflation for manufactured products moved up to 2.7% in September 2017 from 2.6% in August 2017.

As per major commodity group-wise, inflation declined for vegetables, fruits, floriculture, mineral oils, electricity, wearing apparel, leather products, wood products, printing, non-metallic mineral products, motor vehicle and other manufacturing products in September 2017. On the other hand, inflation of pulses, milk, egg, meat fish, spices, oilseeds, fibre, oilseeds, raw rubber, metallic minerals, tobacco products, textiles, paper and paper products, basic metals, chemical products, pharmaceutical products, fabricated metal products, electrical equipment, and other transport equipment increased in September 2017.

Inflation of food items (food articles and food products) more than halved to 2% in September 2017 from 4.4% in August 2017 level. Meanwhile, inflation of non-food items (all commodities excluding food items) moved up to 2.9% in September 2017 from 2.7% in August 2017.

The contribution of primary articles to the overall inflation of 2.6%, stood at 4 basis points (bps) in September 2017, showing dip from 71 bps to 3.24% in August 2017. The contribution of fuel product group eased to 89 bps against 96 bps in August 2017, while that of manufactured products increased to 173 bps compared with 156 bps.

The contribution of food items (food articles and food products) to inflation dipped to 59 bps to 2.6% in September 2017 compared with 132 bps to 3.24% in August 2017. Meanwhile, the contribution of non-food items (all commodities excluding food items) increased to 205 bps in September 2017 compared with 192 bps in August 2017.

The WPI inflation stood at 2.4% in April-September FY2018 against 0.2% in April-September FY2017. The primary articles inflation was at (-) 0.2% in April-September FY2018 from 4.7% in April-September FY2017, while fuel products inflation increased to 9.5% from (-) 10.3%. The inflation for manufactured products jumped to 2.5% in April-September FY2018 from 0.1% in April-September FY2017.

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