India's wholesale inflation softens to 2.47 percent

Wholesale food prices in March fell 0.07% year-on-year compared with a 0.07% rise a month earlier

Wholesale inflation softens marginally to 2.47% as food items turn cheaper

Mr Brown highlighted BRC Shop Price Index data, which showed food prices dropping at their fastest rate in 18 months in March, which could have a larger impact on the inflation figure alongside fuel costs. Retail inflation also slipped to a five-month low of 4.28 per cent in March on account of decline in food prices.

Despite keeping rates on hold, the committee said that "ongoing tightening of monetary policy" would be needed to bring inflation back to the Bank's 2 per cent target.

In contrast, the overall vegetable prices in March deflated (-) 2.70 per cent, against a fall of (-) 0.50 per cent in the same month a year ago.

"The official Wholesale Price Index (WPI) for "All Commodities" for the month of March, 2018 rose by 0.2% to 116.0 (provisional) from 115.8 (provisional) for the previous month", the notification said.

Similarly, the protein-based food items such as eggs, meat and fish became cheaper by (-) 0.82 per cent during the month.

Food inflation came negative at 0.29% in March against 0.88% in the previous month. However, the price of raw silk (7%), mesta and hides (raw) (5% each), sunflower (4%), soyabean (3%), fodder (2%) and raw wool, coir fibre and raw rubber (1% each) moved up.

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However, the price of iron ore, chromite, manganese ore, limestone, zinc concentrate and lead concentrate moved up.

On a monthly basis, wholesale prices increased 0.2 percent at the end of the first quarter.

It was only manufacturing index who saw uptick in March month supporting the growth in WPI. The economists predict CPI rose 0.5 per cent in the March period, accelerating from a 0.1 per cent quarterly pace in December.

It has revised downwards forecast for retail inflation to 4.7-5.1 per cent for April-September and 4.4 per cent for October-March.

With this, the rate of inflation based on WPI Food Index consisting of "Food Articles" from Primary Articles group and "Food Product" from Manufactured Products group decreased from 0.07% in February, 2018 to (-) 0.07% in March, 2018.

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