Sept wholesale inflation shoots up to 6.46%

Food inflation rockets to over 3-year high of 18.4% in Sept against 18.2% in Aug

India’s wholesale inflation remained high at above six% levels in September because of rising vegetable prices, especially onion, according to data released by the commerce ministry on Monday. Wholesale price index- (WPI) based inflation stood at a seven-month high of 6.46% in September, compared to 6.1% in the previous month.

 

This is well above the forecast by analysts, who had pegged the September wholesale inflation at 6%. While WPI-based inflation has been rising since May this year, it seems to have peaked in September. Onion drove up the inflation as its price rose by a massive 322% in the month, on a year-on-year basis, compared with 244% in August. Food inflation swelled to a three-year high of 18.4% in September compared to 18.2% in the previous month.

 

The build-up inflation rate in the current financial year so far is 5.64%, compared to 4.84% in the corresponding period of the previous year.

Wholesale inflation for the second quarter now stands at 6.13%, up from 4.83% in the previous quarter.

 

While petrol prices rose 9.64%, fuel inflation moderated in September as it scaled down to 10.08% from 11.34%. Inflation for manufactured items continued to remain low as it stood at 2.03% in September, although it was marginally higher than 1.9% in August.

 

The inflation rate for June has been revised upwards to 5.85% from the earlier estimate of 5.75%. This will add to the worries of the Reserve Bank of India (RBI), which had raised the repo rate by 25 basis points to 7.5% in September over inflation concerns.

 

On the other hand, consumer price index-based (CPI) inflation, or retail inflation, moderated to 9.64% in August, but it still remains high. September CPI numbers are due to released on Monday evening.

 

Meanwhile, industrial output numbers for August showed disappointment as activity remained flat and grew 0.6% in that month. According to analysts, this points to a high-inflation and low-growth situation, which is a cause of worry.

Month	Sept'12	Oct'12	Nov'12	Dec'12	Jan'13	Feb'13	March'13	April'13	May'13	June'13	July'13	Aug'13	Sept'13
Wholesale Inflation (%)	8.07	7.32	7.24	7.31	7.31	7.28	5.65	4.77	4.58	5.16	5.85	6.1	6.46