NEW DELHI: Even when food prices softened, the wholesale price inflation rose marginally to 11.39% in August, staying in double digit for the fifth month in row, on account of costlier manufactured goods and fuel. In July 2021, WPI inflation was 11.16%, while in August 2020 it was 0.41%.
“The high rate of inflation in August 2021 is primarily due to rise in prices of non-food articles, mineral oils; crude petroleum and natural gas; manufactured products like basic metals; food products; textiles; chemicals and chemical products etc. as compared to the corresponding month of the previous year,” the commerce ministry said.
Inflation in food articles eased for the fourth straight month, recording contraction by 1.29% in August, however price of onion and pulses were up. Inflation in crude petroleum and natural gas was 40.03% in August. In manufactured goods, inflation stood at 11.39% in August, against 11.20% in July. The manufactured goods inflation has remained in double digit for the fourth month in a row.
ICRA Chief Economist Aditi Nayar said the core WPI inflation has displayed an uninterrupted hardening for 15 consecutive months to a fresh all-time high of 11.1% in August 2021, belying the anticipation that the July 2021 print would prove to be the peak. “The headline and core WPI inflation are expected to print in double-digits until October 2021, and then halve by the end of the year. The mild uptick in the Aug ‘21 WPI print does not alter our expectation of a status quo in Oct MPC review,” Nayar added.
Prices of non-food articles see upward movement
The high rate of inflation in August 2021 is primarily due to rise in prices of non-food articles, mineral oils; crude petroleum and natural gas; manufactured products like basic metals; food products; textiles; and chemical products etc., the commerce ministry said.