Inflation at wholesale level touches 15-month high in May
The wholesale price inflation in India increased to 2.61% in May according to the latest figures released by the government. This marks the highest wholesale inflation in the last 15 months since February 2023. The Wholesale Price Index (WPI) rose from 1.26% in April to 2.61% in May registering an uptick for the third consecutive month this year.
The increase in wholesale inflation last month was majorly due to a rise in prices of essential commodities like crude oil and natural gas as well as various food items. Inflation in food articles jumped to 9.82% in May from 7.74% in April. Vegetables saw a massive 32.42% inflation compared to 23.60% in the previous month.
Among other key groups, the primary articles basket, consisting of items like food, fiber, minerals etc. recorded a 7.20% inflation. However, the fuel and power category saw inflation moderate marginally to 1.35% from 1.38% in April. Manufactured products inflation was at a mild 0.78% in May.
The latest wholesale inflation data is in contrast with the retail or consumer price inflation which witnessed a decline to 4.75% in May, the lowest in a year. While framing its monetary policy decisions, the Reserve Bank of India primarily considers retail inflation trends. With prices firming up at wholesale level, investors and analysts will keenly watch the incoming data to see if it has any implications for future interest rate moves.
