Food inflation fell to 3.35 percent in September. (Representative)
New Delhi:
Wholesale inflation remained negative for the sixth month in a row in September, at (-) 0.26 percent, thanks to falling food prices, especially vegetables.
Wholesale Price Index (WPI)-based inflation has been negative since April and stood at (-)0.52 percent in August. In September last year this was 10.55 percent.
Experts said the persistent year-on-year deflation in the WPI was mainly due to a faster decline in food prices.
Food inflation fell to 3.35 percent in September after remaining in double digits for the past two months. In August this was 10.60 percent.
In the vegetable sector, inflation was (-)15 percent, compared to 48.39 percent in August. In the potato sector this amounted to (-)25.24 percent in September, compared to (-)24.02 percent in the previous month.
However, some stiffening of inflation was observed in September in food products such as pulses, onions, milk and fruit.
Inflation for pulses stood at 17.69 percent, while for onions it was at a high of 55.05 percent this month.
The inflation of the fuel and electricity package amounted to (-)3.35 percent in September, compared to (-)6.03 percent in August.
Inflation in industrial products amounted to (-)1.34 percent, compared to (-)2.37 percent in August.
“Deflation in September 2023 is mainly due to the decline in prices of chemical and chemical products, mineral oils, textiles, base metals and foodstuffs compared to the corresponding month of the previous year,” the Ministry of Trade and Industry said on Monday.
Barclays MD and head of EM Asia Economics Rahul Bajoria said waning momentum in core inflation and decline in vegetable prices are driving moderation in retail inflation. But the sequential increase in WPI for manufactured products remains to be seen as manufacturers pass on higher costs to retail prices.
“As of now, robust surveys indicate that the pace of increase in retail prices is lower than that of input prices (as reflected in the manufacturing and services PMIs, and RBI’s industrial outlook survey). We expect the RBI to continue to pause for an extended period as it monitors uncertainty on the commodity front, both in terms of domestic prices of non-perishable food items and international energy prices,” Bajoria said.
Data released last week showed annual retail or consumer price inflation was 5.02 percent in September, a three-month low.
Earlier this month, RBI forecast CPI inflation at 5.4 per cent for 2023-24. The central bank has left the policy rate unchanged for the fourth time in a row in order to decide on monetary policy, as it aims to keep inflation within the target range of 2 to 6 percent.
(Except for the headline, this story has not been edited by DailyExpertNews staff and is published from a syndicated feed.)
