In August, wholesale price inflation remained negative for the fifth consecutive month, primarily due to deflation in the segments of gasoline, power, and manufactured goods, but food inflation remained high.
Data released by the commerce and industry ministry showed inflation, as measured by the Wholesale Price Index (WPI), contracted 0.5%, narrower than the 1.4% drop in July. The negative rate of inflation in August, 2023 is primarily due to fall in prices of mineral oils, basic metals, chemicals, textiles and food products as compared to the corresponding month of previous year, according to the statement.
Inflation in the food industry during the month was 10.6%. Prices of vegetables increased annually by 48.4% while those of onions increased by 31.4%. During the month, the inflation rate for pulses was 10.5%. While manufactured goods fell 2.4% in August, the fuel and electricity sector shrank by 6%. “With the support of high base fading, some uptick in WPI inflation could be seen in the second half,” said Rajani Sinha, chief economist at ratings agency CareEdge.