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India Jan Wholesale Inflation Hits 9-Mth High On Costlier Manufactured Items, Fuel

Friday,   14-Feb-2020   12:48 PM (IST)

India’s wholesale price inflation rate quickened to 3.1% in January from a year earlier, recording its fastest pace since April last year and accelerating for the third straight month, driven by rebound in prices of manufactured products and fuel. The January reading outpaced a median forecast of a 2.92% annual expansion according to a Reuters poll of economists and was faster than 2.59% expansion in December.  Wholesale food index was at 10.12% in January, slower than a 11.05% expansion in the previous month. Wholesale prices of manufactured products, which has a 64.23% weightage in the WPI, rose 0.34% from a year earlier in January, rebounding from an annual 0.25% contraction in December. Fuel and power costs rose 3.42% from a year earlier, versus 1.46% annual decline in December. However, crude oil prices, India’s costliest import, had eased for the first time in three months in January, with the benchmark Brent crude oil contract falling about 12%. It swung between a four-month high of $71.75 a barrel to a three-month low of $57.71 a barrel. India imports over 80% of its crude oil requirements. Wholesale prices of essential food items such as vegetables rose 52.72% in January, easing from the earlier month’s 69.69% annual pace of expansion. Onion prices soared 293.37% in January, slower than a 455.83% surge last month. Wholesale potato prices jumped 87.84% in January versus a 44.97% expansion in December. Sugar prices increased 4.22% in January, cooling from 4.71% expansion in December. Milk prices rose 3.70%, faster than 2.64% gain in the previous month. The government kept November’s wholesale annual inflation reading unchanged at 0.58%. Today’s data are provisional and can be revised later.