WPI inflation increases to six-month high of 3.6% in October 2017

Core inflation flat at 2.8% in October 2017

The Wholesale Price Index (WPI)-based inflation, base year 2011-12, rebounded to six month high pace of 3.6% in October 2017 from 2.6% in September 2017. Among the three major components of WPI index, the inflation for primary articles and fuel products increased, while the manufactured products group has exhibited a slight decline in inflation in October 2017. Core inflation (manufactured products excluding foods products) was flat at 2.8% in October 2017.

Inflation of primary articles jumped to 3.3% in October 2017 from 0.2% in September 2017. The inflation for fuel items also rose to 10.5% in October 2017 from 9% in September 2017. The inflation for manufactured products eased to 2.6% in October 2017 from 2.7% in September 2017.

As per major commodity group-wise, inflation increased for vegetables, fruits, egg, spices, oilseeds, floriculture, metallic minerals, mineral oils, electricity, textiles, wearing apparel, wood products, chemical products, rubber & plastic products, other non-metallic products, computer products, electrical equipment, machinery & equipment and furniture in October 2017. On the other hand, inflation of pulses, milk, sugarcane, fodder, limestone, food products, beverages, pharmaceutical products, basic metals and fabricated metal products declined in October 2017.

Inflation of food items (food articles and food products) increased to 3.2% in October 2017 from 2% in September 2017 level. Meanwhile, inflation of non-food items (all commodities excluding food items) moved up to 3.7% in October 2017 from 2.9% in September 2017.

The contribution of primary articles to the overall inflation of 3.6%, stood at 87 basis points (bps) in October 2017, showing jumped from 4 bps to 2.6% in September 2017. The contribution of fuel product group increased to 105 bps against 89 bps in September 2017, while that of manufactured products eased to 167 bps compared with 173 bps.

The contribution of food items (food articles and food products) to inflation moved up to 96 bps to 3.6% in October 2017 compared with 59 bps to 2.6% in September 2017. Meanwhile, the contribution of non-food items (all commodities excluding food items) increased to 263 bps in October 2017 compared with 205 bps in September 2017.

The WPI inflation stood at 2.6% in April-October FY2018 against 0.3% in April-October FY2017. The primary articles inflation eased to 0.3% in April-October FY2018 from 4.4% in April-October FY2017, while fuel products inflation increased to 9.6% from (-) 9%. The inflation for manufactured products jumped to 2.5% in April-October FY2018 from 0.3% in April-October FY2017.

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