India's WPI Inflation Eases to 0.27% in January
By : Madhusudan Sahoo
Update: 2024-02-14 16:44 GMT
New Delhi: With the moderation in prices of food items, including vegetables, India's wholesale price index or WPI-based inflation eased in January to 0.27 per cent. The WPI inflation was at 4.8 per cent in January 2023 and 0.73 per cent in December 2023. The WPI inflation was in the negative zone from April to October last year and had turned positive in November at 0.39 per cent, the commerce and industry ministry said in a statement on Wednesday.
As per the ministry’s data, all items on food inflation declined to 6.85 per cent in January, from 9.38 per cent in December 2023. “Within food articles, inflation in vegetables eased to 19.71 per cent from 26.3 per cent in December. Inflation in potatoes was in the negative zone. Similarly, the prices of fruits, eggs, milk, fish, and milk have eased as well,” the ministry said.
Despite easing the wholesale inflation, the government is little worried about the overall headline retail inflation, but is confident that India can manage it well. “The fight against inflation is not over yet as supply side constraints may continue globally, though perhaps India has learnt to manage it with reforms, which are beginning to have a positive impact,” chief economic advisor (CEA) V Anantha Nageswaran said.
“We are not done yet in our fight against inflation. We are going to be a supply-constrained world. If our inflation performance in 2022 and 2023 is any indicator, perhaps we have learnt to manage inflation. However, the supply side reforms will begin to have a positive impact. Inflation is important as it has implications on social stability for households,” Nageswaran said at an event here.
“India has had supply side constraints because of which the growth spurts have been sprints rather than marathons, unlike China. Our policymakers should thus think of productivity seriously. Going ahead, the return differential will lend a bias to Indian rupee vis-a-vis dollar for investors,” he added.
As per the ministry’s data, in the fuel and power segment, inflation was (-) 0.51 per cent in January, as against (-) 2.41 per cent in December 2023. “In manufactured products, inflation was (-) 1.13 per cent, as against (-) 0.71 per cent in the previous month,” the statement said.
The Reserve Bank in its bi-monthly monetary policy earlier month held interest rates steady with a view to bring down headline retail inflation at 4 percent, while retail inflation still rules over 5 per cent. As per government data, the month-over-month change in WPI index for January 2024 stood at (-) 0.33 per cent, as compared to December 2023.
“The index for primary particles declined by 1.04 per cent to 181 in January, 2024 from 182.9 for December. However, the prices of minerals (0.93 per cent) increased in January, this year over December 2023. On the other hand, prices of crude petroleum and natural gas (-) 0.33 per cent, non-food articles (-) 0.49 per cent and food articles (-) 1.36 per cent declined in January, 2024 as compared to December,” it said.