Wholesale Price Inflation Drops to 1.89% in November

NEW DELHI: The wholesale price-based inflation (WPI) has dropped to a three-month low of 1.89% in November, primarily driven by a reduction in food prices. The WPI inflation in October 2024 was recorded at 2.36%.

Financial experts anticipate a 0.25% interest rate cut by the Reserve Bank of India (RBI) during the February policy review. Data reveals that food inflation decreased to 8.63% in November from 13.54% in October, while vegetable inflation saw a significant decline to 28.57% from 63.04% in the previous month.

Despite the overall decline, potato inflation remained high at 82.79%, whereas onion inflation dropped significantly to 2.85% in November. Additionally, the fuel and power sector reported a deflation of 5.83% in November compared to 5.79% in October, while manufactured items showed a 2% inflation increase from 1.50% in October.

Barclays' analysis attributes the decline in wholesale price inflation to lower primary food inflation, despite the rise in manufactured products inflation. "December to date, global prices are up 0.7% and are likely to push December WPI inflation higher," Barclays noted. Earlier, consumer price index data showed retail inflation at 5.5% in November, down from 6.2% in October, falling within the monetary policy committee's tolerance range of 2-6%.