Official data show that the country’s wholesale inflation rate was 0.58% in July, the lowest inflation level in two years. This marks a second straight month of deflation.
As measured by the wholesale price index, also known as title inflation, wholesale inflation is the rate at which wholesale prices of selected items rise. A negative reading of the wholesale price index indicates a wholesale pathway – also known as negative inflation.
The latest reading is in separate official data showing domestic consumer inflation at an eight-year low of 1.55%.
In the fuel and power category, wholesale access changed from 2.65% to 2.43% last month.
Food ventilation – measured by the WPI Food (WPI-F) index – was 2.15% in July, compared with 0.26% last month.
Inflation of manufacturing products increased from 1.97% in June to 2.05% in July.
In the main article group, WPI inflation was 4.95% last month, compared with 3.38% in June.
The inflation rate of core inflation (or excluding volatile items such as food and energy) was 1.1% in July, up 10 basis points (BPS) from 1.0% in June.
Core inflation rate reading can be read more stably and accurately by stripping away categories known for sharp short-term price fluctuations.
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Inflation and RBI
The monetary policy committee led by the governor of the Reserve Bank of India is aiming to limit consumer inflation to less than 2% of the medium-term target of 4%.
It mainly tracks retail inflation data, mainly to formulate its monetary policy.
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