Wholesale price inflation climbs to 2.38 per cent in February

Pushed by expensive manufactured food items like vegetables oil and beverages, the wholesale price inflation (WPI) marginally increased to 2.38 per cent in February, the government said on Monday.

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While WPI was 2.31 per cent in January, it was 0.2 per cent in February 2024.

The development assumes significance as the marginal rise in WPI was witnessed after three consecutive months of decline.

In contrast, the retail inflation data released on Wednesday showed that Consumer Price Index (CPI) based inflation eased to a 7-month low of 3.61 per cent in February on easing prices of food items.

The month-over-month change in WPI for the month of February stood at 0.06 per cent as compared to January, the statement issued by the Ministry of Commerce and Industry showed, while revealing that positive rate of inflation in February, 2025 is primarily due to the increase in prices of manufacture of food products, food articles, other manufacturing, non-food articles and manufacture of textiles.

While inflation in manufactured food products rose to 11.06 per cent, vegetable oil rose by 33.59 per cent, beverages increased marginally to 1.66 per cent during the month.

According to the date, the manufactured products index increased overall by 0.42 per cent in February while prices of vegetables cooled with potato prices dropping to 27.54 per cent from 74.28 per cent during the month.

Additionally, prices of milk moderated at 1.58 per cent from 5.40 per cent in February while fruits and onion prices were still ruling high with 20 per cent and 48.05 per cent inflation, respectively.

However, the fuel and power category witnessed a deflation of 0.71 per cent during the last month, against a deflation of 2.78 per cent in the previous month.

“The downward pressure on the headline print on account of the dip in food inflation was offset by the narrowing deflation in the fuel and power segment, and an uptick in the core (non-food manufacturing) WPI inflation to a 24-month high of 1.3 per cent,” the ICRA Senior Economist Rahul Agrawal said, while hinting that while healthy crop output and an elevated base is expected to lead to further cooling in the WPI-food inflation in the near term, higher-than-normal temperatures pose an upside risk to the food inflation trajectory.

He added that the ICRA expects the WPI inflation to average at 2.5-3 per cent in the financial year 2025-26.