Wholesale Inflation touches high of 14.5% in march

Wholesale Inflation touches high of 14.5% in march

As commodity prices increased with the ongoing Russia-Ukraine crisis, the wholesale price index (WPI)-based inflation rate in March jumped to the second-highest level in the current 2003-04 inflation series.

According to industry department data issued on Monday, wholesale price inflation touched a four-month high of 14.55 percent in March. This is slightly lower than the record high of 14.87 percent set in November of the previous year.  With the March stats, WPI has stayed in the double digits during FY22, with an average inflation rate of 12.96 percent for the fiscal year. This is the highest in 30 years. 

The ongoing Russia-Ukraine crisis has pushed up food and commodity prices, forcing the Reserve Bank of India (RBI) to reconsider its accommodative policy stance. The central bank maintained key policy rates unchanged in the most recent monetary policy review earlier this month. It also indicated that it would prioritise keeping inflation under control over incentivizing growth. 

Key Topics:

• The Reserve Bank of India reduced its FY23 growth forecast to 7.2 percent from 7.8 percent.

 • It raised its year-end inflation forecast to 5.7 percent from 4.5 percent, assuming crude oil prices of $100 per barrel. 

• Retail inflation in India reached a 17-month high of 6.95 percent in March. 

• The wholesale food inflation rate fell sequentially to 8.06 percent in March. Vegetable price increases remained high at 19.88 percent. 

• Among non-food products, crude petroleum increased by a stunning 83.56 percent in March, resulting in a 34.52 percent increase in fuel inflation for the month. 

• After a two-month break, the manufactured price inflation rate returned to double digits in March, at 10.71 percent. 

• Edible oil and basic metals jumped by 16.06 percent and 25.97 percent. 

• Core inflation, which excludes volatile food and fuel prices, increased to 10.9 percent in March from 10 percent in February. 

• Among non-food items, crude petroleum rose by a whopping 83.56 percent in March, leading to a fuel inflation rate of 34.52 percent during the month.

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