WPI Inflation rises to nine month high of 3.1% in January 2020

Core WPI inflation rises to (-) 1.0% in January 2020

The Wholesale Price Index (WPI)-based inflation, base year 2011-12, continued to accelerate higher for third straight month to 9-months high of 3.1% in January 2020, showing further increase from 2.6% in December 2019, 0.6% in November 2019 and 0% in October 2019.

Among the three major sub-groups, the inflation for primary articles eased after sharp jump in last few months, while inflation for fuel and power group and manufactured products group moved up contributing to increase in inflation for January 2020. The core inflation (manufactured products excluding foods products) increased to (-) 1.0% in January 2020 from (-) 1.5% in December 2019.

The WPI inflation is retained unchanged at 0.6% for November 2019 from the figure reported at provisional level.

As per major commodity group-wise, inflation increased for mineral oils, basic metals, other non-food articles, food products, other manufacturing, milk, chemicals and chemical products, eggs, meat & fish, crude petroleum & natural gas, fibres, printing and reproduction of recorded media , condiments & spices, oil seeds, electrical equipment etc. On the other hand, inflation of vegetables, floriculture, metallic minerals, pharmaceuticals, medicinal chemical and botanical products, other non-metallic mineral products, textiles, fabricated metal products, except machinery and equipment, tobacco products, furniture, motor vehicles, trailers and semi-trailers, rubber and plastics products etc declined in January 2020.

Inflation of primary articles declined to 10.0% in January 2020 from 11.5% in December 2019. The inflation for fuel and power group inflation turned positive after seven months to 3.4% and manufactured products to 0.3% in January 2020 from (-) 1.5 and (-) 0.3% in December 2019.

Inflation of food items (food articles and food products) eased from 72-month high of 11.0% in December 2019 to 10.1% in January 2020. Meanwhile, inflation of non-food items (all commodities excluding food items) turned positive to 0.4% in January 2020 from (-) 0.7% in December 2019.

The contribution of primary articles to the overall inflation of 3.10% declined to 254 basis points (bps) in January 2020, from contribution of 289 bps to 2.59% in December 2019. The contribution of fuel product group further increased to 38 bps against (-) 16 bps in December 2019, while that of manufactured products moved up to 22 bps in January 2020 from (-) 16 bps in December 2019.

The contribution of food items (food articles and food products) to inflation declined to 286 bps to 3.10% in January 2020 compared with 310 bps to 2.59% in December 2019. Meanwhile, the contribution of non-food items (all commodities excluding food items) jumped to 0.26 bps in January 2020 from (-) 50 bps in December 2019.

The WPI inflation was lower at 1.7% in April-January FY2020 against 4.5% in April- January FY2019. The primary articles inflation moved up to 7.2% in April- January FY2020 from 2.3% in April- January FY2019, while fuel products inflation was negative at (-) 2.5% from 13.3%. The inflation for manufactured products declined to 0.2% in April- January FY2020 from 4.0% in April- January FY2019.

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