Wholesale inflation falls to 34-month low in April
New Delhi, May 15
Wholesale prices in India fell for the first time in almost three years in April, as softening global commodity prices brought down food, fuel, and other input costs for producers.
Wholesale Price Index (WPI-based) inflation has been on a declining trend for the past 11 months and came in at (-) 0.92% in April. This is the lowest level of WPI since June 2020, when inflation was at (-) 1.81%.
Global commodity prices soften
- This is the lowest level of wholesale price index (WPI) since June 2020, when inflation was at (-) 1.81%
- A negative WPI inflation, technically termed as deflation, means that overall wholesale prices have been falling year-on-year
- The high base at 15.38% in April 2022 also contributed to the decline in wholesale inflation in April this year
A negative WPI inflation, technically termed as deflation, means that overall wholesale prices have been falling year-on-year.
Deflation is not unknown and is not considered good for the economy if it occurs on a sustained basis. In India, however, it has been temporary in recent times with the February 2015 WPI index recorded at minus 2.33%. It occurs when there is a sharp fall in the prices of some of the goods.
According to official data released by the Ministry of Commerce and Industry on Monday, WPI-based inflation rate was 1.34% in March and 3.85% in February.
Meanwhile, merchandise exports fell by 12.7% (third time in row) to $34.66 billion in April from $39.70 billion in the same month last year. Services, exports, however rose to $30.36 billion in April this year as compared to $24.05 billion in the same month last year.
