India's wholesale inflation, measured through the wholesale price index (WPI), declined to 13.93% in July 2022 as compared to 15.18% in June 2022, shows the commerce ministry data. WPI remains in double-digit for the 16th straight month since April 2021. Wholesale inflation has not only declined for the second time in a row in five months, but it has also come down below the 15% territory after three months.
The wholesale inflation in the food index during July also declined to 9.41% as compared to 12.41% in June and 10.58% in May.
The commerce ministry says the wholesale inflation in July 2022 is primarily contributed by rising prices of mineral oils, food articles, crude petroleum & natural gas, basic metals, electricity, chemicals & chemical products, food products etc.
While the retail inflation has been a roller coaster ride, coming down a bit from the historic highs of April 2022, the wholesale inflation continues to be sticky, raising concerns.
For primary articles, the wholesale inflation during the month under review was 15.04%, down from 19.22% in June and 18.84% in May 2022. Prices of food articles, non-food articles, and crude petroleum & natural gas, all of them declined in July 2022 as compared to June 2022 at -2.56%, -2.61%, -5.05%, respectively.
The fuel & power index increased by 6.56% in July 2022, with prices of mineral oils and electricity rising by 7.95% and 6.38% in July 2022 as compared to June 2022.
The index of manufactured products declined by 0.42% in July 2022 on a month-on-month basis. Of the 22 NIC two-digit groups for manufactured products, nine groups witnessed an increase in prices, while 12 groups saw a decrease in prices.
The increase in prices is mainly due to other manufacturing, machinery and equipment, and fabricated metal products. The groups that saw a decrease in prices are food products, basic metals, textiles, wood and products of wood and cork, rubber and plastics products, electrical equipment, and chemical and chemical products.
Besides, India's retail inflation, measured via Consumer Price Index (CPI), continued its gradual downward trajectory in July, easing to 6.71% from 7.01% in June and 7.04% in May. This decline in consumer prices comes as the Reserve Bank of India (RBI), in line with its global counterparts, continues with its policy rate hikes to rein in mounting inflationary pressures stemming from the Russia-Ukraine war and subsequent rise in fuel and commodity prices. Consumer price inflation remains above the central bank’s upper tolerance band of 6%, and core inflation continues to be elevated and sticky, putting downward pressure on the country’s economic growth.
