NEW DELHI Wholesale inflation eased to 3.07 per cent in April on cheaper fuel and manufactured items, even as prices of food articles remained high, official data released Tuesday showed.
The Wholesale Price Index-based inflation was at 3.18 per cent in March and 2.93 per cent in February. It was 3.62 per cent in April 2018.
Inflation in the ‘food articles’ basket hardened to 7.37 per cent during April 2019 as against 5.68 per cent in March, as prices of vegetables skyrocketed. Food inflation has been on the rise for the last five months since December 2018 when it was (-) 0.42 per cent.
Vegetables inflation too has seen a steep rise since December 2018 when it was (-)19.29 per cent. It stood at 40.65 per cent in April, up from 28.13 per cent in the previous month.
Amongst food items, inflation in potato cooled to (-)17.15 per cent. In case of onion and fruits, it stood at (-)3.43 per cent and (-)6.88 per cent, respectively, in April.
However, inflation in the ‘fuel and power’ category cooled to 3.84 per cent, from 5.41 per cent in March.
Inflation in diesel halved to 3.24 per cent during the month from 7.33 per cent in March. For petrol, inflation was 1.74 per cent in April, as against 1.78 per cent in the previous month.
However, inflation in LPG spiked to 11.48 per cent in April, from 0.94 per cent in the month before.
The price of non-subsidised cooking gas (LPG) was increased by Rs 5 per 14.2-kg cylinder to Rs 706.50 on April 1. Non-subsidised LPG is the gas that consumer buys after exhausting their quota of 12 cylinders of 14.2-kg at sub-market or subsidised rates. Price of subsidised LPG was almost unchanged at Rs 495.86 on April 1.
Manufactured items too saw easing of prices with inflation at 1.72 per cent in April, against 2.16 per cent in the previous month.
The Reserve Bank, which mainly factors in retail inflation for its monetary policy, had last month cut interest rate by 0.25 percentage points. The next policy review in scheduled for June 6.
Assocham Deputy Secretary General Saurabh Sanyal said, “Both WPI and retail inflation remain benign, well below the 4 per cent target of the RBI, making out a strong case for a rate reduction by the central bank next month”.
Assocham further said the overall food inflation remains well within control and there is an abundant supply of food items. “Lower cost of borrowing is one of the major factors for reviving consumer interest.”
According to official data released Monday, retail inflation inched up to a six-month high of 2.92 per cent in April due to a spike in food prices, including vegetables and protein rich items.
The RBI has projected retail inflation to remain at 2.9-3 per cent during April-September, mainly due to lower food and fuel prices as well as expectation of a normal monsoon.