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      WPI inflation declines to 3.39% in October 2016

      MoM Team / Mumbai, Nov 15, 2016 03:25 PM IST

        WPI inflation declines to 3.39% in October 2016

        The Wholesale Price Index (WPI)-based inflation eased for the second straight month to 3.39 percent in October 2016 from 3.6 percent in September 2016 and 3.9 percent in August 2016. The decline in WPI inflation was mainly driven by dip in inflation for primary articles, while inflation for fuel & power and manufactured products group moved up in October 2016. Further, the unfavourable base effect restricted sharp decline in inflation in October 2016.

        Inflation of primary articles dipped to 3.3 percent in October 2016 from 4.8 percent in September 2016. The inflation for manufactured products rose to 2.7 percent in October 2016. Further, the inflation for fuel items accelerated further to 6.2 percent in October 2016 from 5.6 percent in September 2016.

        As per major commodity group-wise, inflation eased for foodgrains, fruits, fish, mutton, spices, fibres, oilseeds, raw rubber, flowers, grain mill products, sugar, oil cakes, edible oils, textiles, wood and products, and paper & products in October 2016. On the other hand, inflation rose for vegetables, milk, iron ore, copper ore, crude petroleum, mineral oils, dairy products, tea & coffee products, cashew kernel, leather products, rubber and plastic products, chemical products, non-metallic mineral products, and basic metals in October 2016.

        Inflation of food items (food articles and food products) eased to 6.3 percent in October 2016 from 7.5 percent in September 2016. Meanwhile, inflation of non-food items (all commodities excluding food items) moved up to 2.1 percent in October 2016 from 1.8 percent in September 2016.

        Core inflation (manufactured products excluding foods products) rose to 1.1 percent in October 2016 from 0.6 percent in September 2016.

        The contribution of primary articles to the overall inflation, at 3.39 percent, was 96 basis points (bps) in October 2016 compared with 137 bps in September 2016. The contribution of manufactured products was 151 bps compared with 140 bps, while that of fuel product group was 92 bps against 83 bps in September 2016.

        The contribution of food items (food articles and food products) to inflation fell to 1.97 bps in 3.39 percent in October 2016 compared with 233 bps to 3.57 percent in September 2016. Meanwhile, the contribution of non-food items (all commodities excluding food items) was 144 bps in October 2016 compared with 126 bps in September 2016.

        As per the revised data, the inflation figure for August 2016 was revised up to 3.9 percent compared with 3.7 percent reported provisionally.


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      Source: Capital Market



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