India’s June wholesale prices rise at fastest annual pace in 16 months

WHOLESALE prices in India rose at their fastest annual pace in 16 months in June on the back of costlier food, Indian government data showed on Monday (Jul 15).

The wholesale price index (WPI) rose 3.4 per cent in June compared to the year earlier.

This is slightly lower than the 3.5 per cent gain expected by economists polled by Reuters, but higher than a 2.6 per cent year-on-year (yoy) rise in May.

In February 2023, wholesale inflation stood at 3.9 per cent.

For June, food prices posted an 8.7 per cent yoy rise, compared with an increase of 7.4 per cent in May. Vegetable prices were also up 38.8 per cent yoy, against a 32.4 per cent rise in the previous month.

Manufactured product prices rose 1.4 per cent yoy against a 0.8 per cent increase in the previous month. Fuel and power prices rose 1 per cent, compared with a 1.4 per cent gain in May.

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“The upmove in the WPI inflation in June 2024 was broad-based, driven by all the major segments, except fuel and power,” said Aditi Nayar, an economist at ICRA – an independent credit rating agency in India.

Retail inflation rate in the country also rose for the first time in five months in June due to a sharp rise in food prices, data from the Indian government showed last Friday.

Policymakers have failed to cap prices on key food items, which have been hit by extreme heat and heavy floods in the northern states in the country. REUTERS