According to data released by the Ministry of Commerce and Industry on Tuesday, India’s Wholesale Price Index (WPI) inflation fell below the 4% mark in February, registering at 3.85%. This is a decrease from January’s WPI inflation figure of 4.73%, and the lowest it has been since January 2021 when it was 2.51%.
In a press release, the Ministry stated that the decrease in the inflation rate in February was primarily due to falling prices of crude petroleum and natural gas, non-food articles, food products, minerals, computer, electronic and optical products, chemicals and chemical products, electrical equipment, and motor vehicles, trailers, and semitrailers.
On a month-on-month basis, the WPI changed by 0.20%. The Ministry added that “the rate of inflation based on WPI Food Index decreased from 2.95% in January 2023 to 2.76% in February 2023.” On Monday, government data revealed that Consumer Price Index (CPI)-based inflation was at 6.44% in February, remaining above the Reserve Bank’s comfort level of 6% for the second consecutive month.
The inflation rate for the food basket stood at 5.95% in February, slightly lower than the 6% recorded in January, and 5.85% in February of last year. The data also showed that inflation in rural areas was higher at 6.72% during the month compared to 6.10% in urban centers. Vegetable prices saw a decline of 11.61% on an annual basis, but there was a double-digit increase in spices (20.20%) and cereals and products (16.73%), according to the data.
In conclusion, the latest data from the Ministry of Commerce and Industry suggests that India’s Wholesale Price Index-based inflation rate eased to 3.85% in February, a decrease from January’s figure of 4.73% and the lowest it has been since January 2021. The decrease in the inflation rate is primarily attributed to falling prices of crude petroleum and natural gas, non-food articles, food products, minerals, computer, electronic and optical products, chemicals and chemical products, electrical equipment, and motor vehicles, trailers, and semitrailers. However, despite this positive development, the Consumer Price Index-based inflation rate remained above the Reserve Bank of India’s comfort level of 6% for the second consecutive month, signaling ongoing challenges in the country’s inflation management.
