Wholesale price based inflation remains negative for 5th month

Wholesale price-based inflation remained in the negative territory for the fifth straight month in August at (-)0.52 per cent, but prices of food articles and fuel showed an uptick.

The wholesale price index (WPI) based inflation rate has been in the negative since April and was (-)1.36 per cent in July.

In August last year it was 12.48 per cent.

Inflation in food articles remained in double digit at 10.60 per cent in August, lower than 14.25 per cent in July.

"The negative rate of inflation in August 2023 is primarily due to fall in prices of mineral oils, basic metals, chemical & chemical products, textiles and food products as compared to the corresponding month of previous year,” the commerce and industry ministry said on Thursday.

Fuel and power basket inflation was at (-)6.03 per cent in August, against (-) 12.79 per cent in July.

In manufactured products, inflation rate was (-)2.37 per cent, as against (-)2.51 per cent in July.

The RBI last month kept key interest rate unchanged at 6.5 per cent for the third straight meeting but signalled tighter policy if food prices drive inflation higher.

The central bank takes into account retail or consumer price index based inflation for formulating monetary policy. Retail inflation data for August came in at 6.83 per cent in August, lower than 7.44 per cent in July.