WPI inflation down to 3-month low of 3.57% in September

The wholesale price index (WPI)-based inflation declined to a three-month low of 3.57 per cent in September, from 3.74 per cent in the previous month as food inflation fell sharply by 2.48 percentage points. The trend is in alignment with consumer price index-based inflation, which fell to a 13-month low of 4.31 per cent in September and gave a lead indication that the rate of retail price rise may come

down further in coming months. However, WPI inflation was sharply raised to 3.72 per cent from provisional estimate of 3.55 per cent for the month of July and as such provisional estimates for September released on Friday may be taken with some degree of caution.

The WPI food inflation came down to 5.75 per cent, from 8.23 per cent over this period. In fact, vegetables, which fuelled inflation as recently as July, saw decline in prices by almost 11 per cent.

Pulses, which also pushed up WPI inflation, saw the rate of price rise falling to 23.99 per cent from 34.55 per cent. Inflation would further come down as monsoon has been normal this season. The only exception could be chana (gram), which is a rabi crop.

Amid almost all-round fall in food inflation, fruits and milk acted somewhat as outliers. Inflation in fruits saw an uptick to 14.10 per cent, against 13.91 per cent, while that in milk touched 3.71 per cent from 3.40 per cent.

Even as food inflation came down, inflation in fuels and manufactured products rose.

Fuel price index rose to 5.58 per cent, from 1.62 per cent in August, as diesel prices were up by 19 per cent against 12.15 per cent.

Inflation in manufactured products also increased marginally to 2.48 per cent from 2.42 per cent. It was mainly wood and wood products that saw higher inflation at 3.40 per cent in September, against 1.86 per cent in the previous month.