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Business Standard
14-05-2025
- Business
- Business Standard
WPI inflation falls to 13-month low in April as food, fuel become cheaper
Inflation based on the wholesale price index (WPI) declined to a 13-month low of 0.85 per cent in April from 2.05 per cent in March, on the back of a dip in the prices of food and fuel and power. Price rise also decelerated in the manufactured products category, according to data released by the Ministry of Commerce and Industry on Wednesday. Prices of primary food articles witnessed a deflation after 27 months (of -0.86 per cent). The trend was led by the sharpest declines in the prices of vegetables (-18.26 per cent) since October 2023 and pulses (-5.6 per cent) since October 2018. Potato prices declined 24.3 per cent. Protein-rich food like eggs, meat and fish declined by 0.29 per cent – the first time it happened so since October 2024. Onion price increased 0.2 per cent in April, the slowest in 22 months. Price rise for other food items like paddy (1.87 per cent), cereals (3.81 per cent), fruits (8.38 per cent) and wheat (7.41 per cent) decelerated, too. Easing food inflation is expected to give relief to households and help consumption demand in FY25. Rahul Agrawal, senior economist at ICRA Ratings, said that WPI inflation is expected to soften further in May, aided by a favourable base and trends in wholesale prices of essential food items. Fuel and power prices declined by 2.2 per cent in April. Deceleration in global commodity prices, especially of mineral oils, led to a decline in the prices of kerosene, air turbine fuel and petrol. The prices of petrol (-7.7 per cent) and high speed diesel (-5.04 per cent) declined for the 11th and 24th month straight. Cooking gas price dipped (-0.41 per cent) for the first time since April 2024. Among manufactured products, prices of cement, lime and plaster continued in deflation (-1.42 per cent) for the 16th month straight. Prices of basic metals dipped (-0.64 per cent). The price rise of other major manufactured goods like textiles (0.52 per cent), apparel (0.65 per cent), paper and paper products (2.1 per cent), pharmaceuticals (0.98 per cent), semi-furnished steel (0.25 per cent) and food products (9.51 per cent) decelerated in April. However, the price rise for manufactured vegetable and animal oils, despite deceleration remained in double digit (28.7 per cent) during April. ALSO READ: Paras Jasrai, associate director at India Ratings and Research, said that the decline in manufactured products' prices was broad based as core inflation moderated after increasing for six months. Manufactured products' prices were at a three-month low of 1.3 per cent in April as base metal prices declined. 'The temporary lowering of tariffs by the US and China helps in controlling the heightened uncertainty and volatility. Muted commodity prices along with a favorable base effect for the food segment would keep the wholesale inflation around 0.5 per cent in the near term,' he said. The drop in WPI inflation comes a day after India's retail inflation moderated to nearly six-year low of 3.16 per cent, aided by a double-digit dip in vegetable prices and the deepest decline in pulses prices in over six years. 'This dual disinflation offers a substantial macroeconomic tailwind, with the pricing environment favorable for rural consumption recovery. This strengthens the case for future rate cuts - a move that will lower borrowing costs, revive capex appetite among corporates and offer rate sensitive sectors a timely boost,' said Mahendra Patil, managing partner, MP Financial Services.
Time of India
14-05-2025
- Business
- Time of India
WPI at 13-month low in April on declining food prices
India's wholesale price inflation saw a significant drop in April. It reached a 13-month low, settling at 0.85%. This decline was primarily driven by falling food prices. Data indicates a deflation in primary food articles after 27 months. Fuel and power segments also contributed to this decrease. Experts anticipate further moderation in WPI inflation in the near future. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads New Delhi: India's wholesale price inflation fell to a 13-month low of 0.85% in April as food prices continued its decline, official data released Wednesday Wholesale Price Index (WPI), which measures change in producer prices, was 2.05% in March and 1.2% in April 2024."This was largely led by primary food articles, which witnessed a deflation after a gap of 27 months, and the fuel and power segments," said Rahul Agrawal, senior economist at ICRA Besides, the deflation in crude petroleum and natural gas also expectedly widened between these months, aided by the continued correction in global crude oil prices, Agrawal Jasrai, associate director at India Ratings and Research (Ind-Ra), said, "Benign food inflation along with a sharp decline in fuel and energy prices helped in keeping the wholesale inflation at a tepid level."WPI food inflation fell to a nearly two-year low of 2.55% in April from 4.66% in key food items, vegetables and pulses inflation contracted by 18.3% and 5.6% year-on-year, respectively, in April. In contrast, fruit prices increased 8.4%.Cereals inflation was at a 42-month low of 3.8% in April due to better Kharif output. While potato prices decelerated by 24.3%, onion prices increased by 0.2%."The easing of food inflation would help in bringing relief to households and the consumption demand as we begin the new fiscal year," said in manufactured products, which account for 64.23% weight in the WPI, rose 2.6% in April compared to 3.1% in manufactured products, vegetables & animal oils and fats recorded the highest inflation of 28.7%, followed by food products manufacturing at 9.5%.Inflation in primary articles contracted by 1.4% from a positive 0.8% in March. Similarly, fuel and power inflation decelerated by 2.2% from positive 0.2% in March."The decline in fuel & power and energy prices in April was due to the tariff-tantrum led deceleration in global commodity prices," noted inflation is expected to moderate further, according to experts."Muted commodity prices along with a favourable base effect for the food segment would keep the wholesale inflation around 0.5% in the near term," said anticipates it to ease slightly to 0.5-0.8% in May."Looking ahead, the India Meteorological Department's (IMD) expectation of an early monsoon onset in Kerala and an above normal monsoon in the country is a positive for crop output, and consequently, the food inflation outlook, although the spatial and temporal distribution of the same remains key," noted Agrawal.
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Business Standard
14-05-2025
- Business
- Business Standard
Wholesale price inflation drops to 13 -month low of 0.85% in April
India's wholesale price index (WPI)-based inflation dipped to a 13-month low of 0.85 per cent in April from 2.05 per cent in March, driven by a decline in food and fuel and power prices. The price rise also decelerated in the manufactured products category during the month, which has a weight of 64.2 per cent in the index, data released by the Ministry of Commerce and Industry on Wednesday showed. Data showed that the prices of primary food articles (-0.86 per cent) witnessed deflation after a gap of 27 months. This was led by the sharpest decline in vegetable prices (-18.26 per cent) since October 2023 and the steepest fall in pulses prices (-5.6 per cent) since October 2018. Potato prices declined further (-24.3 per cent), while protein-rich items like eggs, meat and fish (-0.29 per cent) saw a price drop for the first time since October 2024. The easing food inflation is expected to bring relief to households and boost consumption demand as the new financial year begins. Rahul Agrawal, senior economist at ICRA Ratings, said wholesale food price inflation is expected to soften further in May, aided by a favourable base and relatively moderate wholesale prices of essential food items so far this month. Fuel and power prices declined by 2.2 per cent in April due to a deceleration in global commodity prices, especially of mineral oils, leading to a fall in the prices of kerosene, air turbine fuel and petrol. The prices of both petrol (-7.7 per cent) and high speed diesel (-5.04 per cent) continued to decline for the 11th and 24th consecutive month, respectively. The price of cooking gas also dipped (-0.41 per cent) for the first time since April 2024. Among manufactured products, prices for cement, lime and plaster remained in deflation (-1.42 per cent) for the 16th month in a row, while prices for basic metals dipped (-0.64 per cent) due to a fall in global prices during the month. Meanwhile, the price rise for other major manufactured goods like textiles (0.52 per cent), apparel (0.65 per cent), paper and paper products (2.1 per cent), pharmaceuticals (0.98 per cent), semi-finished steel (0.25 per cent) and food products (9.51 per cent) also decelerated. However, the price rise for manufactured vegetable and animal oils, despite slowing, remained in double digits (28.7 per cent) during April. ALSO READ: Paras Jasrai, associate director at India Ratings and Research, noted that the declining trend in manufactured products was broad-based, with core inflation also moderating after six consecutive months of increase. It stood at a three-month low of 1.3 per cent in April due to a decline in base metal prices. 'The temporary lowering of tariffs by the US and China helps in controlling the heightened uncertainty and volatility. Muted commodity prices along with a favourable base effect for the food segment would keep wholesale inflation around 0.5 per cent in the near term,' he added. The drop in factory gate inflation for April comes a day after India's retail inflation also moderated to a nearly six-year low of 3.16 per cent, aided by a double-digit fall in vegetable prices and the steepest decline in pulses prices in over six years. 'This dual disinflation offers a substantial macroeconomic tailwind, with the pricing environment favourable for rural consumption recovery. This strengthens the case for future rate cuts — a move that will lower borrowing costs, revive capex appetite among companies and offer rate-sensitive sectors a timely boost,' said Mahendra Patil, managing partner, MP Financial Services.
Indian Express
14-05-2025
- Business
- Indian Express
India's April wholesale inflation slows to 13-month low as food prices fall
Wholesale price inflation dropped to a 13-month low of 0.85 per cent in April with softening in prices of food articles, fuel and manufactured products, with experts projecting further easing in the data of next month, government data showed on Wednesday. WPI-based inflation was 2.05 per cent in March. It was 1.19 per cent in April last year. WPI inflation lower than 0.85 per cent was last recorded in March, 2024, when it was 0.26 per cent. 'Positive rate of inflation in April, 2025 is primarily due to an increase in prices of manufacture of food products, other manufacturing, chemicals and chemical products, manufacture of other transport equipment and manufacture of machinery and equipment, etc,' the industry ministry said in a statement. As per the WPI (Wholesale price index) data, deflation in food, and fuel and power WPI, along with disinflation in manufactured products drove the moderation. Food articles saw a deflation of 0.86 per cent in April, against an inflation of 1.57 per cent in March. Deflation in vegetables was 18.26 per cent during April compared to deflation of 15.88 per cent in March. In onion, inflation eased to 0.20 per cent in April, as against 26.65 per cent in March. Inflation in fruits softened to 8.38 per cent, from 20.78 per cent in the previous month. Potato and pulses saw a deflation of 24.30 per cent and 5.57 per cent, respectively. 'Favourable base effects to keep WPI inflation low in coming months,' Barclays said in a research note. Deflation in fuel and power was 2.18 per cent in April, compared to a 0.20 per cent inflation in March. 'Sharp sequential decline in prices of mineral oils such as kerosene (which was also reflected in consumer prices) and ATF and motor fuels, drove this fall,' Barclays said. Crude oil prices have generally remained in the USD 60-65/ barrel handle in April, with downward pressure arising from OPEC+ announcing production increases. OPEC+ is a group of 23 oil-producing countries that work together to manage the supply of oil in the world market in order to influence global oil prices. Manufactured products, however, saw inflation at 2.62 per cent in April, compared to 3.07 per cent in March. ICRA Senior Economist Rahul Agrawal said the IMD's expectation of an early monsoon onset in Kerala and an above normal monsoon in the country is a positive for crop output, and consequently, the food inflation outlook, although the spatial and temporal distribution of the same remains key. 'We expect the WPI to average sub-2 per cent in FY2026, which, along with our CPI inflation and real GDP projections for the fiscal implies that nominal GDP growth may be capped at 9 per cent,' Agrawal said. Data released on Tuesday showed retail inflation eased to a near 6-year low of 3.16 per cent in April mainly due subdued prices of vegetables, fruits, pulses, and other protein-rich items. Easing of inflation would create enough room for the Reserve Bank, which mainly takes into account retail inflation while formulating monetary policy, to go in for another round of rate cut in the June monetary policy review. In April, the RBI cut the benchmark policy rate by 0.25 per cent to 6 per cent. This was the second cut during the year to stimulate the economy, facing the threat of US reciprocal tariffs. The RBI sees retail inflation averaging 4 per cent in the current fiscal from the previous estimate of 4.2 per cent.
Time of India
14-05-2025
- Business
- Time of India
India's wholesale inflation eases to 13-month low of 0.85% in April from March's 2.05% as food and fuel prices soften
India's wholesale price inflation eased to a 13-month low of 0.85% in April 2025, helped by a decline in the prices of food items, fuel, and manufactured goods. Experts predict that rate could further decline in the coming month. Tired of too many ads? go ad free now This marked a significant drop from the 1.19% inflation rate recorded over the same period last year and the 2.05% seen in March 2025, according to data released by the ministry of commerce and industry on Wednesday. The ministry said, 'Positive rate of inflation in April, 2025 is primarily due to an increase in prices of manufacture of food products, other manufacturing, chemicals and chemical products, manufacture of other transport equipment and manufacture of machinery and equipment, etc.' Barclays, in a research note pointed, "Favourable base effects to keep WPI inflation low in coming months." Food articles and vegetables witness sharp fall for the month stood at 0.26% up from March's negative figure of 0.32%. On a year-on-year basis, food articles recorded a deflation of 0.86% in April, compared to an inflation rate of 1.57% in March. Vegetables saw the steepest drop, with annual deflation widening to 18.26% in April from 15.88% in the previous month. Notably, potato prices fell by 24.3% year-on-year, while onion inflation plummeted from 26.65% in March to just 0.20% in April. Other categories such as pulses also registered significant deflation at 5.57%, while inflation in fruits rose to 8.38%. Dairy products like milk saw a modest increase of 0.59%, whereas prices of eggs, meat, and fish declined slightly by 0.29%. Fuel and power prices slide further Fuel and power inflation slid to -2.82% in the month of April, down from March's 0.6.5%. Tired of too many ads? go ad free now The fuel and power category saw an annual deflation of 2.18% in April compared to a slight inflation of 0.20% in March. The drop was led by falling prices in mineral oils like kerosene by 3.95% and electricity by 1.38%. Petrol and diesel prices fell by 7.70% and 5.04% respectively on a monthly basis. "Sharp sequential decline in prices of mineral oils such as kerosene (which was also reflected in consumer prices) and ATF and motor fuels, drove this fall," Barclays said. Manufactured products Inflation for manufactured products inched at 0.35%, up from 0.28% in March. Rahul Agrawal, senior economist at ICRA, noted that IMD's forecast of an early monsoon onset in Kerala and an above-average monsoon across the country is promising for crop production, which in turn gives a positive outlook for food inflation. However, he also added that the distribution of the monsoon, both geographically and over time, will be crucial. "We expect the WPI to average sub-2 per cent in FY2026, which, along with our CPI inflation and real GDP projections for the fiscal implies that nominal GDP growth may be capped at 9 per cent," Agrawal said. Retail inflation eases, opening policy room for RBI Retail inflation, which is the apex bank's primary gauge for monetary policy, dropped to 3.16% in April, the lowest since July 2019. The easing was attributed to muted prices of vegetables, fruits, pulses, and protein-rich items. The moderation in both retail and wholesale inflation may pave the way for another rate cut in the upcoming RBI monetary policy review in June. The central bank had already cut its benchmark policy rate by 0.25 percentage points in April to 6%, to support growth amid external headwinds such as the threat of US reciprocal tariffs. The RBI has revised its inflation forecast for the current fiscal to an average of 4%, down from the previous estimate of 4.2%. Data released on Tuesday showed that retail inflation also dropped to a near six-year low of 3.16% in April, primarily driven by lower prices of vegetables, fruits, pulses, and other protein-rich foods.
