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Vegetables, Foods Expensive. Wholesale Inflation At 16-Month High: Govt

  • By Thetripurapost Desk, Agartala
  • Jul 16, 2024
  • 281

Wholesale inflation rose to a 16-month high of 3.36 percent in June as food items, especially vegetables, and manufactured goods became more expensive. This is the fourth consecutive month when the wholesale inflation rate has increased.

The Wholesale Price Index (WPI) based inflation rate was 2.61 percent in May. It was (-) 4.18 percent in June 2023. The wholesale inflation rate was 3.85 percent in February 2023.

"The increase in inflation in June 2024 is mainly due to increase in prices of food articles, crude oil and natural gas, mineral oils and other manufactured goods," the Ministry of Commerce and Industry said in a statement on Monday.

According to the data, the inflation rate of food items increased to 10.87 percent in June, which was 9.82 percent in May.

The inflation rate of vegetables was 38.76 percent in June, which was 32.42 percent in May. The inflation rate of onion was 93.35 percent and that of potatoes was 66.37 percent. The inflation rate of pulses was 21.64 percent in June.

The inflation rate of fruits was 10.14 percent, the inflation rate of food grains was 9.27 percent and the inflation rate of milk was 3.37 percent.

ICRA Chief Economist Aditi Nair said that the increase in wholesale inflation in June 2024 was broad-based. Prices of all major sectors except petrol-diesel and electricity have increased during June.

Wholesale inflation is expected to moderate to around 2 per cent in July 2024 on the back of a favourable comparative base along with some softening in global commodity prices, he said.

On oil prices, Nair said that the average crude oil prices in India have seen a lot of volatility so far in July 2024. Due to the difference in demand and supply, an increase is being seen on a monthly basis.

He said that high crude oil prices may put pressure on wholesale inflation in the current month. Inflation in the fuel and electricity basket stood at 1.03 percent. This is slightly lower than 1.35 percent in May.

However, prices of crude petroleum and natural gas witnessed a double-digit rise of 12.55 per cent. Inflation in manufactured goods stood at 1.43 per cent in June, up from 0.78 per cent in May.

This increase in WPI in June was in line with the retail inflation data. According to data released last week, retail inflation rose to a four-month high of 5.1 per cent in June. The Reserve Bank of India mainly takes retail inflation into account while formulating monetary policy