WPI Inflation: Wholesale inflation rate was -0.52 percent in August, increase seen compared to July

Last month in August the wholesale inflation rate was -0.52 percent. It still remains in negative territory. Wholesale price-based inflation remained in negative territory for the fifth consecutive month in August at (-)0.52 percent.

At the same time, a rise was seen in the prices of food items and fuel. The Wholesale Price Index (WIP) based inflation rate has been negative since April and stood at (-)1.36 percent in July. In August last year, it was 12.48 percent.

In August, the inflation rate of food items was in double digits at 10.60 percent. Whereas in July this year, it was 14.25 percent.

The Ministry of Commerce and Industry said the negative rate of inflation in August 2023 is mainly due to a decline in prices of mineral oils, basic metals, chemicals, chemical products, textiles, and food products compared to the same month last year.

The inflation of the fuel and electricity basket in August was (-) 6.03 percent. It was (-)12.79 percent in July. The inflation rate in manufactured products stood at (-) 2.37 percent, whereas in July it was (-) 2.51 percent.

The RBI, in its third consecutive meeting last month, has decided to keep the key interest rate unchanged at 6.5 percent. At the same time, if inflation increases due to food prices, then a strict policy is indicated.

The central bank takes into account retail or consumer price index-based inflation to formulate monetary policy. Retail inflation data for August came in at 6.83 percent, down from 7.44 percent in July.