Wholesale inflation rises for 8th month in row, PPI debuts

NEW DELHI: India’s wholesale inflation surged for the eighth consecutive month to 9.7% in May from 8.3% in April on account of high prices of crude oil and manufactured products, the newly released wholesale price index (WPI) series Monday with the updated 2022-23 base year showed.Besides, the Department for Promotion of Industry and Internal Trade (DPIIT) also released the maiden producer price index (PPI), covering the output and input manufacturing prices and prices of seven services – banking, securities transaction, insurance, management of pension funds, railways, air passengers and telecom. It estimated inflation at 9.4% in May, driven largely by mining and quarrying (19%) and manufactured products (11.3%).

Going their sparate ways

In WPI, prices of crude petroleum and natural gas accelerated 61% in May, as compared to 56% in April. Similarly, the prices of mineral oils accelerated 50% during the month, reflecting the impact of the supply chain disruptions caused due to the prolonged conflict in west Asia. “If prices do come down sharply as has been seen today, there can be moderation in WPI inflation for sure on this account,” said Bank of Baroda chief economist Madan Sabnavis.The factory gate prices for manufactured products rose 7.5% in May from 6.7% in April, led by acceleration in the prices of industries like food products, textiles, leather, chemicals, electrical equipment, basic metals, among others. The weightage for manufactured products has slightly come down to 63.1% in the new series. Wholesale prices of food items also witnessed a rise in May as food index rose to 4.5% in May from 3.1% in April.The new WPI series has seen an increase in the coverage of items to 957 from 697. New sources of energy, such as solar and wind, along with nuclear power, have been added under the electricity group. The new series showed that wholesale inflation stood at 0.4% in FY26.