Wholesale Price Index (WPI)-based inflation jumped to a two-month high of 5.13 per cent in September, primarily due to hardening of food prices and rise in cost of petrol and diesel.
The WPI-based inflation stood at 4.53 per cent in August and 3.14 per cent in September last year.
Food articles witnessed hardening of prices with deflation at 0.21 per cent September as against 4.04 per cent in August, according to the government data released Monday. Deflation in vegetables was 3.83 per cent in September, compared to 20.18 per cent in the previous month, indicating relative rise in prices. Inflation in ‘fuel and power’ basket in September was 16.65 per cent. Individually, in petrol and diesel it was 17.21 per cent and 22.18 per cent, respectively, and for LPG it was 33.51 per cent.
ICRA Principal Economist Aditi Nayar said while crude oil prices have cooled in the recent sessions, and excise duty and VAT cuts will provide some relief for fuel prices, the weaker rupee will continue to raise the inflation in the current month. Data released last week showed retail inflation rose to 3.77 per cent in September from 3.69 per cent in the previous month. The RBI mainly takes into account retail inflation data while formulating monetary policy. —With PTI