: WPI inflation hits 4-month high of 14.55% in March #FinanceIndia #StockMarketNEWS #Business Press Trust of India New Delhi The wholesale price-based inflation spiked to a four-month high of

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WPI inflation hits 4-month high of 14.55% in March #FinanceIndia #StockMarketNEWS #Business
Press Trust of India

New Delhi

The wholesale price-based inflation spiked to a four-month high of 14. 55% in March on rising prices of crude oil and other commodities due to disruption in global supply chain in the wake of the Russia-Ukraine war, a development that may prompt the Reserve Bank of India (RBI) to raise interest rates to contain price rise.

In February, WPI Inflation was at 13. 11%, while in March last year, it was 7. 89%. WPI inflation has remained in double digits for the 12th consecutive month since April 2021.

In November 2021, it had touched a high of 14. 87%.

The data released by the Commerce and Industry Ministry on Monday, showed that crude oil prices were the biggest contributor to the rise in WPI inflation in March 2022, relative to February, followed by fuels and core items.

Food articles witnessed some softening month-on-month led by vegetables and pulses, even though wheat, paddy, potato, milk, egg, meat and the fish basket saw moderate increases during March.

During March, inflation in food articles eased to 8. 06%, from 8. 19% in February. Vegetable inflation was 19. 88% in the month under review, as against 26. 93% in February.

“The high rate of inflation in March, 2022 is primarily due to rise in prices of crude petroleum and natural gas, mineral oils, basic metals, etc owing to disruption in the global supply chain caused by the Russia-Ukraine conflict,??? the Commerce and Industry Ministry said.

Inflation in manufactured items was 10. 71% in March, as against 9. 84% in February.

In the fuel and power basket, the rate of price rise was 34. 52% during the month under review, against 31. 50% in February.

Oil companies had begun to pass on the high import cost of global crude oil prices by hiking domestic petrol and diesel prices from March 22 ending a four-and-half-month long hiatus. Besides, domestic cooking gas (LPG) prices were hiked during the month.

India is dependent on imports to meet 85% of its oil needs and so retail rates adjust accordingly to the global movement.

In March, inflation in crude petroleum spiked to 83. 56%, from 55. 17% during February.

Crude oil prices had mostly been on rise in March, after Russia started the invasion of Ukraine on February 24.

ICRA Chief Economist Aditi Nayar said even a normal monsoon may not be enough to douse the retail prices of items which are pushing up food inflation, such as edible oils.

ICRA expects the WPI inflation to remain in the range of 13. 5-15 per cent in the current month, partly depending on where crude oil prices settle in the rest of April 2022 and how much petrol and diesel prices are revised further.