WPI hits 14-month high of 7.52% in November

The annual rate of inflation based on the index of wholesale prices rose to 7.52 per cent in November 2013, its highest since August 2012, against 7.0 per cent in October, official data released today showed.

The official wholesale price index (WPI) for 'all commodities' (having base: 2004-05 = 100) rose by 0.7 per cent to 181.5 in November 2013, from 180.3 in the previous month, according to provisional estimated released today.

WPI inflation stood at 7.24 per cent during the corresponding month of the previous year.

Build-up of inflation during the financial year so far was 6.7 per cent compared to a build-up of 4.84 per cent in the corresponding period of the previous year.

Consumer price (retail price) inflation in the country already at two-digits, has firmed up further to 11.24 per cent in November.

Now, with the wholesale price index also showing a firming tendency, the Reserve Bank of India is expected to raise interest rates further, thereby limiting prospects of an early economic recovery.

The wholesale price index for the primary articles group, which has a weight of 20.12 per cent in the WPI, rose 1.9 per cent from the previous month. 

Within the primary articles group, the index for 'food articles' group rose by 2.0 per cent due to higher prices of egg, condiments and spices, fruits and vegetables, beef and buffalo meat and fish (marine), pork, urad and jowar, moong, maize, ragi and wheat and arhar, mutton, masur, milk and barley.

However, the prices of fish (fresh water), tea, gram and poultry chicken and rice declined.

The index for 'non-food articles' group rose 2.1 per cent month-on-month in November due to higher prices of sugarcane, gingelly seed, soyabean, copra (coconut), tobacco, safflower (kardi seed), rape and mustard seed and castor seed and coir fibre, niger seed, fodder and mesta. 

However, the prices of guar seed, groundnut seed, raw rubber, raw cotton, raw silk, raw jute and flowers and sunflower declined.

The index for the 'minerals' group rose 0.5 per cent due to higher prices of zinc concentrate, steatite and crude petroleum.  However, the prices of barytes, copper ore, phosphorite, sillimanite and iron ore declined.

The index for the 'fuel and power' group, which has a weight of 14.91 per cent in the WPI, increased by 0.1 per cent due to higher prices of LPG, bitumen and high speed diesel.

However, the prices of aviation turbine fuel, petrol and kerosene and furnace oil declined.

The index for the `manufactured products' group, which has a weight 64.97 per cent in the WPI, rose 0.2 per cent in November.

Within the manufactured products group, the index for the 'food products' group rose 0.6 per cent due to higher prices of gingelly oil, processed prawn, rice bran oil and wheat flour (atta), sooji (rawa), maida, ghee, oil cakes and palm oil and coconut oil, tea dust (blended), cotton seed oil, soyabean oil, groundnut oil and mustard and rapeseed oil.

However, the price of gur, khandsari and tea leaf (unblended) and tea dust (unblended), tea leaf (blended), sugar and sunflower oil declined.

The index for the 'textiles' group rose 0.5 per cent due to higher prices of jute yarn, tyre cord fabric, manmade fibre, manmade fabric, jute sacking cloth and cotton fabric.

However, the prices of gunny and hessian cloth and jute sacking bag declined.

The index for the 'wood and wood products' group rose 0.3 per cent due to higher prices of plywood and fibre board.

The index for the 'paper and paper products' group rose 0.4 per cent due to higher prices of kraft paper and bags and cream laid woven paper and printing and writing paper

The index for the 'leather and leather products' group rose 1.3 per cent due to higher prices of leather footwear and leather.

The index for the 'rubber and plastic products' group rose 0.1 per cent due to higher prices of syringe, rigid PVC, rubber brakes and plastic/LDPE/polythene bags and plastic/PVC suitcases, plastic rolls and rubber transmission belts.

However, the prices of rubber components and parts, football and other rubber products and tractor tyre, plastic bottles, polyester film and synthetic rubber compound.    

The index for the 'chemicals and chemical products' group declined by 0.1 per cent due to lower prices of explosives, rubber chemicals  and synthetic resin, toilet soap, non-cyclic compound and pigment and pigment intermediates.

However, the prices of organic manure, hair / body oils, safety matches/ match box and pesticides moved up.

The index for the 'basic metals, alloys and metal products group declined by 0.1 per cent due to lower prices of steel castings, pressure cooker and CRC, lead and iron and steel wire.

However, the prices of steel rods, steel - pipes and tubes - and ferro silicon, brass, silver, steel structures, pig iron and melting scrap moved up.

The index for the 'machinery and machine tools' group rose 0.5 per cent due to higher prices of electric switches, sprinkler and TV accessories, ball/roller bearing, boiler & accessories and machine tools, electric switch gears, lamps and battery dry cells.

However, the prices of electric motors and hydraulic equipment and electronic PCB /micro circuit declined.

The index for the 'transport, equipment and parts' group declined by 0.1 per cent due to lower prices of motor vehicles.

However, the prices of railway axle and wheel and bi-cycles moved up.

The final inflation rate for September 2013 based on the revised WPI for the month stood at 7.05 per cent, against 6.46 per cent estimated earlier.