New Delhi- The wholesale price-based inflation eased to 11-month low of 12.41 per cent in August, on softening in prices of manufactured and fuel products, even as food items remained expensive.
Although the Wholesale Price Index (WPI) based inflation declined for three consecutive months, it remained in double digit for 17th months beginning April last year.
The inflation was 13.93 per cent in July and 11.64 per cent in August last year. It had touched a record high of 15.88 per cent in May this year.
The inflation was lower than August print in September last year when it was 11.8 per cent.
Inflation in food articles in August rose to 12.37 per cent, as against 10.77 per cent in July, on account of costlier cereals, fruits and vegetables.
The rate of price rise in vegetables was 22.29 per cent during the month under review, while in case of potato it was 43.56 per cent.
Inflation in cereals was 1.77 per cent, while in wheat and fruits it was 17.35 per cent and 31.75 per cent respectively.
In the fuel and power basket, inflation was 33.67 per cent in August, as against 43.75 per cent in July. In manufactured products and oil seeds, it was 7.51 per cent and (-) 13.48 per cent, respectively.
The Reserve Bank of India (RBI) mainly looks at retail inflation to frame its monetary policy.
Retail inflation has remained above the Reserve Bank’s upper tolerance threshold of 6 per cent for the eighth month in a row and was at 7 per cent in August.
To tame stubbornly high inflation, the RBI has hiked the key interest rate three times this year to 5.40 per cent.
According to the central bank’s projections, retail inflation is likely to average 6.7 per cent in 2022-23.
Domestic rating agency Icra said WPI inflation likely to ease to 11-12 per cent in September 2022 and print in single digits thereafter.
“The downside surprise was led by a lower-than-anticipated rise in fuel and global commodity prices,” Morgan Stanley said in a note. (PTI)