Indo-Asian News Service
New Delhi, March 14: India’s annual retail inflation eased to 5.18 per cent in February from 5.69 per cent in the month before even as the 12-month wholesale inflation was in the negative for the 16th straight month, official data showed Monday. But the annual price increase of pulses at both wholesale and retail levels was over 38 per cent.
As per data on Wholesale Price Index (WPI) released by the Commerce and Industry ministry, the annual inflation stood at (-) 0.91 per cent for February against (-) 0.90 per cent in the previous month, but was higher than the (-)2.17 per cent level in the like month of the previous year. Also, the annual wholesale inflation for food articles was higher than the overall level at 3.35 per cent for the month, even as pulses were costlier by 38.84 per cent over the past year. At the retail level, against the food inflation of 5.30 per cent, pulses were dearer by 38.30 per cent. The annual wholesale inflation in fuels also continued to decline, thanks to (-) 7.7 per cent drop in the prices of diesel and (-) 1.03 per cent decline in that for petrol. At the retail level, data for which was released by the Central Statistics Office, the fuel index was up 4.59 per cent.
The 12-month wholesale inflation for manufactured goods was in the negative at (-) 0.58 per cent. The fresh set of statistics comes at a time when the country’s factory output declined again in January, by (-) 1.53 per cent, dipping further from the (-) 1.18 per cent fall logged in December. The negative show was for the third straight month.
With inflation at both the wholesale and retail levels under check and the government adhering to its fiscal deficit targets, industry has raised its pitch for the central bank to cut rates and loosen its monetary, ahead of the policy update on April 5. “The union budget for 2016-17, announced last month, has given due focus on boosting demand and encouraging domestic value addition. We have also seen that the fiscal framework will be adhered to by the government,” Ficci said in a statement. “Given this, we firmly believe that the Reserve Bank of India should supplement efforts of the government to strengthen demand and continue with its accommodative stance in the forthcoming monetary policy,” Ficci president Harshavardhan Neotia said.
“A further cut in the policy rate at this juncture and its transmission by the banks in the form of lower lending rates would benefit both companies and consumers alike and impart some momentum to the still weak investment and consumption cycle.”
