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BW Businessworld

July WPI Inflation Eases To 5-month Low Of 5.19%

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Thanks to lower fuel costs, the wholesale price inflation in July eased to a five-month low of 5.19 per cent despite persistent inflationary trends in the food articles, fruits and vegetables.

According to the official data released on Thursday (13 August), The annual rate of inflation, based on monthly wholesale price index (WPI), stood at 5.19 per cent (provisional) for the month of July, 2014 (over July,2013) as compared to 5.43 per cent (provisional) for the previous month and 5.85 per cent during the corresponding month of the previous year. Build up inflation rate in the financial year so far was 2.38 percent compared to a build up rate of 3.17 per cent in the corresponding period of the previous year.

The movement of the index for the various commodity groups is summarised below:-

Primary Articles (Weight 20.12%)
The index for this major group rose by 2.7 per cent to 256.6 (provisional) from 249.9 (provisional) for the previous month. The groups and items which showed variations during the month are as follows:-

The index for ‘Food Articles’ group rose by 3.6 per cent to 258.6 (provisional) from 249.7 (provisional) for the previous month due to higher price of  fruits & vegetables (16 per cent), maize (8 per cent), condiments & spices and urad (6 per cent each), jowar (5 per cent), masur (4 per cent), egg, arhar and tea (2 per cent each) and pork, beef & buffalo meat, mutton, wheat, barley, bajra and ragi (1 per cent each).  However, the price of fish-inland (15 per cent), gram and fish-marine (3 per cent each), poultry chicken (2 per cent) and moong (1 per cent) declined.

The index for ‘Non-Food Articles’  group rose by 0.8 percent to 218.1 (provisional) from 216.4  (provisional) for the previous month due to higher price of  guar seed and gingelly seed (sesamum) (7 per cent each), copra (coconut) (4 per cent), castor seed and niger seed (3 per cent each) and rape & mustard seed, fodder, cotton seed and mesta (1 per cent each).  However, the price of raw jute (5 per cent), raw rubber (4 per cent) and raw silk, soyabean, sunflower and groundnut seed (1 per cent each) declined.

The index for ‘Minerals’ group rose by 0.1 per cent to 346.1 (provisional) from 345.6 (provisional) for the previous month due to higher price of barytes (22 per cent), steatite and magnesite (5 per cent each), sillimanite (2 per cent) and chromite and copper ore (1 per cent each).  However, the price of phosphorite (3 per cent) and zinc concentrate (2 per cent) declined.

Fuel & Power (Weight 14.91%)
The index for this major group rose by 1.1 per cent to 214.7 (provisional) from 212.3 (provisional) for the previous month due to higher price of petrol and furnace oil (3 per cent each), bitumen and high speed diesel (2 per cent each) and aviation turbine fuel (1 per cent).

Manufactured Products (Weight 64.97%)
The index for this major group rose by 0.3 per cent to 155.4 (provisional) from 154.9 (provisional) for the previous month. The groups and items for which the index showed variations during the month are as follows:-

The index for ‘Food Products’ group rose by 1.7 per cent to 174.6 (provisional) from 171.6 (provisional) for the previous month due to higher price of tea leaf (unblended) (11 per cent), tea dust (unblended) and tea dust (blended) (10 per cent each), tea leaf (blended) and coffee powder (6 per cent each), oil cakes (4 per cent), sugar, gur and salt (3 per cent each), ghee (2 per cent) and vanaspati, bakery products, soyabean oil, groundnut oil, sugar confectionary and powder milk (1 per cent each). However, the price of processed prawn (8 per cent), sooji (rawa) (2 per cent) and rice bran oil, gingelly oil, cotton seed oil and wheat flour (atta) (1 per cent each) declined.

The index for ‘Beverages, Tobacco & Tobacco Products’ group rose by 0.7 percent to 198.7 (provisional) from 197.4 (provisional) for the previous month due to higher price of  rectified spirit (5 per cent), bidi (2 per cent) and dried tobacco (1 per cent).

The index for ‘Textiles’ group rose by  0.1 per cent to 144.1 (provisional) from 143.9 (provisional) for the previous month due to higher price of  jute sacking cloth, jute yarn,  cotton yarn, man made fibre and jute sacking bag (1 per cent each).  However, the price of man made fabric and gunny and hessian cloth (1 per cent each) declined.

The index for ‘Wood & Wood Products’ group declined by 0.9 percent to 185.4 (provisional) from 187.0 (provisional) for the previous month due to lower price of plywood & fibre board (2%).

The index for ‘Paper & Paper Products’ group rose by 0.1 per cent to 149.3 (provisional) from 149.2 (provisional) for the previous month due to higher price of corrugated sheet boxes (1%).

The index for ‘Leather & Leather Products’ group declined by 0.9 per cent to 144.3 (provisional) from 145.6 (provisional) for the previous month due to lower price of leather garments & jackets (8%).

The index for ‘Rubber & Plastic Products’ group rose by 0.3 per cent to 150.6 (provisional) from 150.2 (provisional) for the previous month due to higher price of tyres (1%).

The index for ‘Non-Metallic Mineral Products’ group rose by 0.5 per cent to 168.1 (provisional) from 167.3 (provisional) for the previous month due to higher price of bricks & tiles and marbles (2 per cent each).

The index for ‘Basic Metals, Alloys & Metal Products’ group declined by 0.2 percent to 166.8 (provisional) from 167.1 (provisional) for the previous month due to lower price of ferro manganese (3 per cent) and HRC, gold & gold ornaments, melting scrap, billets, ferro silicon and plates (1 per cent each).  However, the price of steel rods (4 per cent), wire rods (2 per cent) and pressure cooker (1 per cent) moved up.

The index for ‘Machinery & Machine Tools’ group rose by 0.1 per cent to 133.9 (provisional) from 133.8 (provisional) for the previous month due to higher price of hydraulic equipment, battery dry cells, fans, insulators and magnets (1 per cent each). However, the price of fibre optic cable (12 per cent), cranes (2 per cent) and rubber machinery (1 per cent) declined.

Final Index For The Month Of May, 2014 (Base Year: 2004-05=100)
For the month of  May, 2014, the final Wholesale Price Index for ‘All Commodities’ (Base: 2004-05=100) stood at 182.0 as compared to 181.7 (provisional) and annual rate of inflation based on final index stood at 6.18 percent as compared to 6.01 percent respectively as reported on 16.06.2014.