Inflation Dips To 6.5%, Wpi Down To 322.5

Continuing its downtrend, the annual rate of inflation based on provisional wholesale prices index (WPI) fell further to 6.54 per cent for the week ending April 19.

Inflation fell by 0.10 percentage points during the week under review from 6.64 per cent, thanks to a continued easing of prices of food articles. As the official WPI for all commodities (base 1981-82=100) dropped marginally to 322.5 from 322.6 for the previous week.

Compared to this, inflation was around 4.63 per cent during the corresponding week in April last year.

Inflation has been steadily moving southwards ever since it touched a 63-week high of 8 per cent in the second week of February due to easing of prices of food articles. Since February, prices of food articles, having a composite weight of 17.4 points in WPI, came down by 1.91 per cent.

 

The annual inflation rate based on the final index for the week ending February 22, 1997, stood at 7.8 per cent as against 7.9 per cent for the week based on provisional index.

Among the three major groups, fuel, power, light and lubricants group having a total weight of 10.66 per cent in the WPI had the highest inflation at 16.23 per cent. Price rise in primary articles (weight 32.23 per cent) was lower at 6.78 per cent, while that of manufactured products (weight 57.04 per cent) was 4.60 per cent.

This is the 101st consecutive week that the inflation has maintained single digit levels.

After touching single digits in June 1995, inflation came down considerably to touch a historical low of 4.2 per cent in June 1996.

However, it started climbing up again after the petroleum price hike in the first week of July 1996. Interestingly, the inflation based on consumer price index (CPI), which is more reflective of the price movements to the consumer, is still hovering in double digits at 10 per cent during March 1997 compared to 7.43 per cent during the same month based on WPI.

Prices of wheat, eggs, raw rubber, cotton seed, sulphur pyrites, dolomite, bran, coconut oil, filament yarn synthetic and copper wires declined substantially during the week while that of bajra, tea, copra, sunflower, biscuits, khandsari, calcium carbide, tablets and synthetic resins went up. A group-wise movement shows that the index for the major primary articles group declined by 0.1 per cent to 335.4 from 335.8 for the last week.

Under primary articles, the index for food articles group remained unchanged at its previous week's level of 384.9.