India’s annual wholesale price-based inflation (WPI) eased to 10.70% in September, according to data released by the Ministry of Commerce & Industry. The wholesale inflation had spiked to 12.41% during August, while the WPI for July was revised to 14.07% from 13.93%, the data showed. The WPI in September 2021 was 11.80%.

September is the 18th straight month of double-digit WPI inflation. This year, the Wholesale Price Index touched a record high of 15.88% in May.

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Inflation in September is mainly contributed by an increase in prices of mineral oils, food items, crude, petroleum and natural gas, chemicals & chemical products, basic metals, electricity, textiles, etc as compared to the corresponding month of the previous year, according to the government release.

Food inflation based on WPI Food Index also eased to 8.08% in September from 9.93% in August. The month-on-month decline can be attributed to a dip in the prices of wheat, pulses, and fruits.

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Fruits prices eased to 4.51% in September, against 31.75% in August. Prices of pulses fell 0.28% and onions slipped 20.96%. Wheat prices eased to 16.09% in September from 17.35% in August while that of eggs, meat & fish eased to 3.63% from 7.88% a month ago. However, inflation in vegetables rose to 39.66% during the month, as against 22.29% in August.

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In the fuel and power segment, inflation came in lower at 32.61% in September, against 33.67% in August. LPG prices eased to 8.45% from 19.75% a month ago, but HSD (High-Speed Diesel) spiked to 65.96% from 60.15% and petrol prices rose to 40.38% from 38.68%.

The manufactured products segment eased to 6.34% in September from 7.51% a month ago.

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In a separate data released earlier this week, the country’s retail inflation, measured by the Consumer Price Index (CPI) rose to a five-month high of 7.41% in September, driven by soaring food prices. This has added pressure on the Reserve Bank of India (RBI) to act aggressively to slow price increases. Inflation has remained over the RBI’s upper tolerance limit of 6% for the ninth straight month.

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Economists project inflation to hover around the 7% mark over the next couple of months due to last year’s low base, even as easing energy and commodity prices globally would help cool inflationary pressures. RBI has projected inflation for 2022-23 at 6.7%.

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The central bank looks at retail inflation to frame monetary policy. RBI’s monetary policy committee (MPC) hiked the repo rate for the fourth time in a row on September 30, taking the policy rates to a three-year high of 5.9%.