Inflation-based on wholesale price index (WPI) eased to 4.53% in August on account of decline in the prices of food commodities such as vegetables and pulses.
WPI inflation stood at 5.09% in July and 3.24% in August last year.
As per data released on Friday, food articles registered deflation at 4.04% during the month under review while deflation in vegetables, pulses and fruits was 20.18%, 14.26% and 16.40%, respectively.
Fuel basket
Inflation in the ‘fuel and power’ basket was 17.73%.
While inflation in liquefied petroleum gas (LPG) was 46.08%, in diesel and petrol it was 19.90% and 16.30%, respectively. “When taken together with the fall in CPI inflation number which has also surprised on the downside during the month, the data would help boost sentiments,” said Chandrajit Banerjee, director general, CII.
He added that the decline in the inflation reading should induce the RBI to resume its accommodative policy stance.
PTI adds:
Petrol, diesel costlier
Brent crude oil price is hovering at around $79 a barrel. This, along with a depreciating rupee, has increased the oil import bill, thereby making petrol and diesel costlier.
Data released earlier this week showed that retail inflation eased to a 10-month low of 3.69% in August. The Reserve Bank of India (RBI) mainly takes into account retail inflation data while formulating the monetary policy.
In its third monetary policy review for the fiscal, the RBI last month hiked interest rate by 0.25% to 6.5% on inflationary concerns.
For July-September, the RBI pegged CPI-based retail inflation at 4.2%, which it saw firming up to 4.8% in the second half of the current fiscal.
