India's wholesale inflation still negative, but tad up

India's annual wholesale inflation continued to be in the negative in May but moved up slightly to (-)2.36 percent from (-)2.65 percent in the previous month, mainly on account of a rise in prices of food articles, official data showed on Monday.

The annual inflation rate based on the Wholesale Price Index (WPI) was recorded at 6.18 percent in May 2014.

During the period under review, the index for food articles was up 3.8 percent in May mainly due to a 22.8 percent increase in prices of pulses and 20.41 percent in that for onions. Potatoes, however, were cheaper by 51.95 percent.

Other important food articles such as fruits, milk and wheat became dearer. Fruits were expensive by 8.65 percent, followed by milk which was costlier by 6.85 percent and wheat lightened the pocket by another 2.79 percent.

Among the other major sub-indice of the WPI, the annual inflation for fuel in May was (-)10.41 percent, data released by the commerce and industry ministry showed.

The prices of liquefied petroleum gas (LPG) fell by 5.18 percent, petrol became cheaper by 11.29 percent and diesel cost came down by 11.62 percent.

The manufactured products sub-indice also declined. It stood at (-)0.64 percent. The primary articles sub-indice was marginally down by (-)0.77 percent.

The official data showed that the rise in May was the first time after successive declines during the last seven months.

On a month-on-month basis the annual inflation successively decelerated in the past six months -- from 1.66 percent in October 2014 to (-)0.17 percent in November to (-)0.5 percent, (-)0.95 percent, (-)2.06 percent, (-)2.33 percent and (-) 2.65 percent, respectively, in the next five months.

The marginal rise in the WPI-based inflation comes on the back of retail inflation also gaining momentum.

The consumer price index (CPI) measured by the Central Statistical Office (CSO) inched up to 5.01 percent in May from 4.8 percent in April.

The retail inflation was at 8.33 percent in the corresponding month of 2014.