WPI inflation seen at 3-month high of 0.6% in March
Informist, Wednesday, Apr 10, 2024
By Shubham Rana
NEW DELHI – India's WPI inflation is likely to have risen to a three-month high of 0.6% in March after falling to a four-month low of 0.2% in February, according to an Informist poll of 16 economists. In March 2023, WPI inflation was 1.41%.
At 0.6%, the overall WPI index will rise 0.5% on a sequential basis in March. In the last 11 years, on an average, the overall index has risen 0.4% in March from the previous month. The commerce and industry ministry is scheduled to release WPI inflation data for March at 1200 IST on Monday.
Even though WPI inflation is expected to rise in March, it is still seen below 1% for the 12th consecutive month, primarily on account of disinflation in fuel and manufactured products groups.
"Sequentially we expect core inflation to have witnessed a positive momentum for the first time in six months, led by the impact of higher global commodity prices," Kotak Mahindra Bank Chief Economist Upasna Bhardwaj said. Wholesale core inflation fell to a six-month low of (-)1.3% in February.
Prices of commodities, including crude oil, rose in March. Brent crude oil prices rose over 6% during the month, while gold prices rose more than 8%.
Food prices showed a mixed trend in March. Wholesale prices of tomato and onion fell 3.0% and 0.8%, respectively, compared to the previous month, data collated by the Department of Consumer Affairs shows. Prices of potato, on the other hand, jumped up 7.2% sequentially in March.
WPI inflation continues to be sharply below CPI inflation, primarily due to softening of non-food commodity prices that are better captured in the WPI. CPI inflation, which will be released on Friday, is expected to moderate to a five-month low of 4.9% in March from 5.1% in February, according to an Informist poll of 18 economists.
"Going ahead, WPI inflation is likely to trend even higher amid adverse base effect and higher commodity prices," Bhardwaj said.
The following is a summary of the poll by Informist on WPI inflation in March and the details of estimates by respondents, in ascending order:
