Published: Mon, April 16, 2018
Money | By Armando Alvarado

Inflation dips to 2.47 per cent in March

Inflation dips to 2.47 per cent in March

Deflating food prices softened India's wholesale price-indexed (WPI) inflation to 2.47 per cent in March from 2.48 per cent reported for the previous month, official data showed on Monday.

Primary articles inflation was came at 0.24% in March as compared to 0.79% in the previous month.

Manufactured products inflation was at 3.03 per cent, lower than 3.22 per cent in the same month past year.

"Inflation in the food article category which has been declining since November 2017 turned into deflation in March 2018 mainly driven by the sharp correction in the prices of fruits and vegetable", said Sunil Kumar Sinha, Director - Public Finance and Principal Economist, India Ratings.

That compares to the Reserve Bank's quarterly projection of 0.6 per cent for an annual rise of 1.1 per cent.

ANZ Bank New Zealand economists said the fees-free first-year tertiary education policy broadly offset any inflationary pressure coming from the usual annual increase in tobacco excise duty, with a 4 per cent fall in the education group instead of its typical first quarter rise.

Going ahead, the fuel & power which bags 13.15% of total WPI, declined by 0.1% to 98.0 (provisional) from 98.1 (provisional) for the previous month.

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According to the Commerce Ministry data, the WPI inflation in March 2017 was more than double at 5.11 per cent. However, the price of petroleum coke and kerosene moved up.

The inflation based on Consumer Price Index (CPI), a key data factored in by the RBI to arrive at interest rate, was 4.44 per cent in February. The movement in core inflation at the retail and wholesale level were in the opposite direction in March 2018.

It may be recalled that WPI inflation was at 5.11 per cent in March a year ago.

The index for "food articles" group declined by 0.4 per cent to 137.2 from 137.8 for the previous month, despite a price rise in items like ragi, jowar, peas/chawali, moong and paddy, among others.

The inflation data for January was revised upwards to 3.02 per cent from the provisional estimate of 2.84 per cent.

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