The government released the wholesale price index (WPI) data for the month of September on Monday, October 14. The wholesale inflation came at 1.84%. In August, the wholesale inflation came at 1.31% and in July it came at 2.04%.
The government attributed the positive rate of inflation in September to the increase in prices of food articles, food products, other manufacturing, manufacture of motor vehicles, trailers & semi-trailers, manufacture of machinery & equipment, etc
The Wholesale Price Index or WPI measures the change in prices of goods sold and traded in bulk by wholesale businesses with other companies. Unlike the CPI which tracks prices of goods and services purchased by consumers, WPI tracks factory gate prices and retail prices.
The Ministry of Commerce and Industry releases WPI. Under the index, commodities are categorised into three groups — primary articles (which are further divided into food and non-food articles), fuel and power and manufactured products.
The prices of minerals (1.83%), non-food articles (1.31%), food articles (0.86%) and electricity (1.34%) increased in September 2024 as compared to August 2024. On the other hand, the price of crude petroleum and natural gas (-5.74%) and mineral oil (-1.72%) declined in September as compared to the previous month.
Out of the 22 National Industrial Classification (NIC) two-digit groups for manufactured products, 10 groups witnessed an increase in prices whereas nine groups witnessed a decrease in prices. Three groups witnessed no change in prices.
Food products, other manufacturing, other non-metallic mineral products, computer, electronic and optical products, wearing apparel etc witnessed month-over-month increases in prices. Manufacture of basic metals, textiles, motor vehicles, trailers and semi-trailers, chemicals and chemical products, fabricated metal products, except machinery and equipment, etc reported a decline in prices.
“In terms of food inflation, I think there should be some bit of moderation which we can expect, primarily on account of the expected good Kharif crop. Though I think the only apprehension is that the monsoon has still not fully withdrawn from the country and therefore we have seen in states like Maharashtra, there is definitely a case of vegetable prices being high. That is something which will probably remain for some more time. So, you have to be watchful of these numbers. But on the whole, I think 1.8 is a good number. But we could be expecting the number to move upwards in the coming months,” says Madan Sabnavis, Chief Economist, Bank of Baroda.