New Delhi: Inflation based on the wholesale price index (WPI) eased to 2.47 percent in March helped by a fall in food prices.
Inflation was at 2.48 per cent rise in February and 5.11 per cent in March last year. The wholesale prices of food articles fell 0.29 per cent in March compared to a 0.88 per cent rise in the previous month.
Deflation in pulses was 20.58 per cent, in vegetables (2.70 per cent), wheat (1.19 per cent) and egg, meat and fish (0.82 per cent) in March. Inflation in onion continued to rule high at 42.22 per cent and in potato at 43.25 per cent.
Manufactured products inflation was at 3.03 per cent even as sugar prices fell 10.48 per cent during the month.
However, rising crude oil prices pushed up inflation in the ‘fuel and power’ basket to 4.70 per cent in March from 3.81 per cent in the previous month.
“Unlike the retail inflation which dipped by 16bps in March 2018 over the previous month, the wholesale inflation remained flat. However, there are some noticeable changes at the disaggregate level. Inflation in the food article category which has been declining since November 2017 turned into deflation in March 2018 mainly driven by the sharp correction in the prices of fruits and vegetable,” said Sunil Kumar Sinha, Director - Public Finance and Principal Economist, India Ratings.
However, he said that core inflation dropped to 3.5 per cent in March 2018 from 3.9 per cent in February 2018.
“During March 2018, the movement in core inflation at the retail and wholesale level has been in opposite direction. It may be too early draw any inference from such movement, the divergence suggests that impulse of demand recovery at the moment is being felt at the retail level and not so much at the wholesale level,” said Mr Sinha.
