Vegetables get dearer as wholesale inflation hits 6-month high of 3.59%

Retail inflation a key input for RBI in setting the key interest rate has been rising consistently since June amid a slowdown in factory output measured on Index of Industrial Production

New Delhi, Nov 14 Economic Affairs Secretary S C Garg today attributed the rise in both wholesale and retail inflation numbers to seasonal factors and expressed hope that the rate of price rise would remain below the 4 per cent limit for the fiscal.

Data released by the commerce and industry ministry on Tuesday showed inflation, measured by the wholesale price index (WPI), rose an annual 3.6% in October, higher than the previous month's rise of 2.6% and 1.3% increase in October 2016.

Meanwhile, the index for "Non-Food Articles" group declined by 0.9 per cent to 119.2 (provisional) from 120.3 (provisional) for the previous month due to lower price of raw cotton (5 per cent), fodder, mesta and cotton seed (3 per cent each), raw rubber, safflower (kardi seed) and castor seed (2 per cent each).

"Retail inflation at 3.58 per cent".

Wholesale prices had accelerated in August to 3.24 per cent from July's rise of 1.88 per cent and an increase of 0.90 per cent was reported for June.

Prices of other major group under the WPI, manufactured products, which comprise almost 64.23 per cent of the index, recorded a 2.62 per cent rise.

"Hopefully, increasing trend prove to be seasonal and we will continue to have sub 4 per cent inflation", he said. Fuel and power inflation hit 10.5% compared to previous month's 9% rise. Vegetable prices rose an annual 36.6%, while onion prices soared 127% during the month, a sharp jump from previous month's 79.8% increase.

Fuel inflation has remained high for the past three months as petrol and diesel prices continued to rule high tracking global crude oil rates. However, the price of beedi was up by 4 per cent.

For the "manufactured tobacco products" group WPI rate declined by 1.3 per cent due to lower prices of cigarette and other tobacco products.

As per data, wheat became cheaper by (-) 1.99 per cent on YoY basis and the prices of pulses came down by (-) 31.05 per cent, but paddy became dearer by 3.10 per cent.

The overall food prices, as gauged by the Consumer Food Price Index (CFPI), rose to 1.90 per cent during the month under review from 1.25 per cent in September 2017. We have nearly stopped eating vegetables. My husband is the only earning member in the family of five people.

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