India’s Wholesale Inflation Rises to 3.36% in June 2024

New Delhi, India – The Commerce Ministry has reported that India’s wholesale inflation, measured by the Wholesale Price Index (WPI), increased to 3.36% in June 2024 from 2.61% in May 2024. This rise is attributed to higher prices in food articles, manufactured food products, crude petroleum, natural gas, mineral oils, and other manufacturing sectors.

WPI Trends Over Recent Months

The WPI for all commodities rose from 152.9 in April (1.19% inflation) to 153.3 in May (2.61% inflation) and further to 153.9 in June (3.36% inflation). The primary articles index, which has a weight of 22.62%, increased from 187.1 in April (5.23% inflation) to 187.7 in May (7.20% inflation) and to 191.6 in June (8.80% inflation).

Fuel and Power Index

The fuel and power index, which makes up 13.15% of the total, decreased from 151.4 in April (-0.85% inflation) to 150.6 in May (1.35% inflation) and further to 147.7 in June (1.03% inflation).

Manufactured Products Index

The index for manufactured products, with the largest weight of 64.23%, increased from 141.2 in April (-0.14% inflation) to 141.7 in May (0.78% inflation) and to 141.9 in June (1.43% inflation).

Food Index

The food index, which has a weight of 24.38%, rose from 184.6 in April (6.09% inflation) to 185.7 in May (7.40% inflation) and to 190.3 in June (8.68% inflation).

Monthly Changes and Major Groups

The WPI increased by 0.39% in June compared to May. The primary articles index rose by 2.08% in June from May, with food articles up by 2.96% and minerals by 1.47%. Prices of non-food articles and crude petroleum & natural gas declined by 0.32% and 0.57%, respectively. The fuel and power index fell by 1.93% in June from May, driven by a decrease in electricity prices by 1.67% and mineral oils by 2.38%. The index for manufactured products saw a modest increase of 0.14% in June from May.

Expert Opinion

Aditi Nayar, Chief Economist at ICRA Ltd., commented on the data, stating, “The jump in the WPI inflation to 3.4% in June 2024 was broad-based and along expected lines. Looking ahead, the headline WPI inflation is expected to dip to around 2.0% in July 2024, driven by a favorable base and some cooling in global commodity prices.”

She added, “The up move in the WPI inflation in June 2024 was driven by all major segments except fuel and power. After rising to seven-month high levels in May 2024, global commodity prices have seen a continuous dip.”

The next WPI release for July 2024 is scheduled for August 14, 2024.