Wholesale inflation rises to 0.73% in December due to rise in food prices

Wholesale price index-based inflation rose in December due to a sharp increase in food prices, impacting overall consumer price-based inflation.

The wholesale price index (WPI)-based inflation rose in December at 0.73% mainly due to a sharp rise in food prices. The WPI inflation was in the negative zone from April to October and had turned positive in November at 0.26%.

"Positive rate of inflation in December 2023 is primarily due to the increase in prices of food articles, machinery & equipment, other manufacturing, other transport equipment and computer, electronics & optical products etc," the Commerce and Industry Ministry said in a statement on January 15. Food inflation rose to 9.38% in December from 8.18% in November 2023.

Inflation in vegetables was 26.30%, while in pulses it was 19.60% in December. Retail or consumer price-based inflation (CPI) print for December rose to a 4-month high of 5.69%, as per data released last week.

The Reserve Bank in its bi-monthly monetary policy last month held interest rates steady and flagged risks of rising food inflation in November and December.