Wholesale price rise dropped to 5.85% in November

Food inflation fell to 2.2% from 6.5% in October, but cereals, wheat inflation on an upswing

India’s wholesale price inflation fell sharply to 5.85% in November from 8.4% in October, thanks to a broad-based dip in price rise led by food items whose inflation slipped from from 6.5% in October to just 2.2%.

Inflation in primary articles at the wholesale level halved from 11% in October to 5.5% in November, while manufactured products saw price rise easing from 4.4% to 3.6% over the same period. Fuel and power inflation dropped to 17.35% in November, nearly half the 33.1% recorded in September and lower than October’s 23.2% level.

The Commerce and Industry Ministry said the decline in inflation in November is ‘primarily contributed by fall in prices of food articles, basic metals, textiles, chemicals & chemical products and paper & paper products’ compared November 2021. Wholesale price inflation had slipped below 10% for the first time in 19 months in October.

The high base effect from a year ago also played a role, as wholesale inflation stood at 14.87% in November 2021, but this is the sixth successive month of moderation in wholesale inflation since it hit a record peak of 16.63% in May. Retail inflation also cooled in November to an 11-month low of 5.88% from a nearly eight-year high of 7.8% in April, driven by an over 8% deflation in vegetable prices.

At the wholesale level, vegetables recorded a deflation of 20.1% in November compared to a 17.6% inflation in October, as per official data, with onions recording a 19.2% fall in prices and fruits reported deflation of 1.1%, from a year ago. Potato inflation moderated significantly to 13.75% in November from 45% in October and 49.8% in September.

However, some key food items saw an acceleration in wholesale inflation, similar to the uptick in retail prices, with cereals inflation rising to 12.85% from 12% in October and wheat inflation nudging up from 16.25% in October to 18.11% in November.