India’s wholesale price index (WPI)-based inflation eased to 1.89 per cent in November primarily due to increase in prices of food articles, food products, other manufacturing, textiles, machinery & equipment, etc., data released by the commerce ministry showed on Monday. In November 2023, WPI inflation was 0.39 per cent, and in October this year, it was 2.36 per cent.
The month over month change in WPI for the month of November, 2024 stood at (-)0.06 per cent as compared to October, 2024.
The month-over-month data released by the Ministry of Commerce and Industry showed that the index for primary articles decreased by 1.20 per cent to 197.9 (provisional) in November from 200.3 (provisional) for the month of October, 2024. Th index for Fuel & Power increased by 0.41 per cent to 147.1 (provisional) in November from 146.5 (provisional) for the month of October. The manufactured products index increased by 0.35 per cent to 143.0 (provisional) in November, 2024.
Furthermore, per the release by the Ministry of Commerce & Industry, inflation for food articles eased to 8.63 per cent in November as compared to 13.54 per cent in October. The inflation rate for primary articles dropped to 5.49 per cent from 8.09 per cent in the previous month. The fuel and power inflation was at -5.83 per cent in November as against -5.79 per cent in October. And manufactured products inflation came in at 2.00 per cent from 1.50 per cent in October.
Under the food articles category, vegetable inflation dropped to 28.57 per cent in November, posting a huge dip from 63.04 per cent in October. Pulses inflation during the month of November was at 5.97 per cent, while the inflation for wheat came in at 8.35 per cent during the same month as against 8.04 per cent in October. Eggs, Meat & Fish inflation came in at 3.16 per cent. Potato and onion reported inflation at 82.79 per cent and 2.85 per cent respectively. Onion witnessed a drastic drop from 39.25 per cent inflation in October.
The non-food articles reported WPI inflation at -0.98 per cent in November as against -1.71 per cent during the previous month. Minerals inflation came in at 5.89 per cent in November, up from 1.87 per cent in October. The Crude Petroleum & Natural gas posted wholesale inflation at -8.11 per cent in November and crude petroleum was at -7.72 per cent.
Reacting on this, Rahul Agrawal, Senior Economist, ICRA Ltd, said “The moderation was primarily led by primary food articles, which eased to a three-month low of 8.6 per cent from 13.5 per cent in the previous month, exerting a downward pressure on the headline print to the tune of 91 bps between these months. All the other items witnessed an uptick in their inflation readings in November 2024 vis-à-vis October 2024.”
ICRA, meanwhile, expects the headline WPI inflation to rise to around 2.5-3.0 per cent in December 2024 (+0.9 per cent in December 2023) from 1.9 per cent in November 2024 (+0.4 per cent in November 2023), despite a favourable base. “Looking beyond the ongoing month, the arrival of kharif crops in the market, and the robust outlook for the rabi crop amid healthy sowing trends and elevated reservoir levels, augur well for the food inflation outlook. However, the extent of the seasonal dip in food prices remains a key monitorable,” he said.