India’s wholesale price index (WPI)-based inflation for the month of September accelerated to 1.84 per cent on an annual basis in comparison to a four-month low of 1.31 per cent in August, showed the provisional data released by the Ministry of Commerce & Industry on Monday. In July, WPI inflation was at 2.04 per cent and June inflation had risen to 3.36 per cent. The wholesale price index had witnessed a slight contraction of -0.1 per cent in September 2023.
“Positive rate of inflation in September, 2024 is primarily due to increase in prices of food articles, food products, other manufacturing, manufacture of motor vehicles, trailers & semi-trailers, manufacture of machinery & equipment, etc.,” Ministry of Commerce & Industry said in a statement.
The month over month change in WPI index for the month of September, 2024 stood at 0.06 per cent as compared to August, 2024.
Per the release by the Ministry of Commerce & Industry, inflation for food articles recorded a surge as it went up to 11.53 per cent in September as compared to 3.11 per cent in August. The inflation rate for primary articles went up to 6.59 per cent in September from 2.42 per cent in August. The fuel and power inflation was at -4.05 per cent in September as against -0.67 per cent in August. And manufactured products inflation came in at 1.00 per cent during the month in review.
Under the food articles category, vegetable inflation was recorded at 48.73 per cent in September, posting a huge uptick from -10.01 in August. Pulses inflation during the month of September was at 12.99 per cent, while the inflation for wheat came in at 7.60 per cent during the same month as against 7.28 per cent in August. Cereals inflation was at 8.08 per cent. Eggs, Meat & Fish inflation came in at -0.80 per cent. Potato and onion reported inflation at 78.13 per cent and 78.82 per cent respectively.
The non-food articles reported WPI inflation at -1.64 per cent in September as against -2.08 per cent during the previous month. Minerals inflation came in at 3.03 per cent in September, down from 8.76 per cent during August. The Crude Petroleum & Natural gas posted wholesale inflation at -13.04 per cent in September and crude petroleum was at -16.78 per cent.
Reacting on the data, Aditi Nayar, Chief Economist and Head of Research and Outreach, ICRA Ltd, said, “The uptick was entirely led by an adverse base-led surge in the primary food articles inflation print to a 14-month high of 11.5 per cent in September 2024 from 3.1 per cent in the previous month. This exerted upward pressure to the tune of 156 bps to the headline WPI print between these months, which was partly offset by dips in most other categories including fuel and power, crude petroleum and natural gas, and non-food manufactured items.”
“Following the escalation of tensions in West Asia, crude oil and global commodity prices have witnessed a sequential increase in early-October 2024, which is likely to exert some pressure on the WPI print for the month. Additionally, the WPI-food inflation print is also likely to remain elevated above the 8.0 per cent mark in October 2024 for the second consecutive month, led by a double-digit print in the primary food articles segment. Consequently, ICRA estimates the WPI inflation to inch up to ~2.0-2.5 per cent in October 2024,” she added.