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Lowest WPI inflation registered in May
The Commerce and Industry ministry released data on 14th June about Wholesale Price Index based inflation. India’s wholesale prices fell deeper into the deflationary zone in May. The Wholesale Price Index (WPI) inflation is cool down to -3.48 percent from -0.92 percent in April due to favourable base effect again playing a starring role.
The latest WPI inflation is the lowest in seven-and-a-half years at 3.48 percent. The lowest wholesale inflation was registered at last time in November 2015 at 3.68%.
Not only the wholesale inflation registered lowest but according to the statistics ministry’s data on June 12, headline retail inflation registered to a 25-month low of 4.25% in May.
Even though the base effect favourable the changes in month-on-month in prices is expected at more closely for signs of price momentum.
- The index of manufactured products owns nearly two-thirds of the entire WPI and it is slightly fell by 0.4 percent.
- In this category the biggest month-on-month fall down was seen in edible oils at 3.6 percent.
- At the same time, key categories such as pharmaceuticals, medicinal chemical and botanical products and fabricated metal products registered rise.
- The index for the fuel and power group was gloomy at 2.6 percent.
- The sharp drop in wholesale prices might be welcomed by policymakers as they have been working hard to lower inflationary pressures.
RBI’s monetary policy effect:
- The RBI has just released its monetary policy in which it has left policy repo rate unchanged at 6.5 percent since April.
- The meaning of one basis point is one-hundredth of a percentage point.
- Economists expecting growth hit in coming months even inflation has cooled down. This may force the RBI’s monetary policy committee to start trimming interest rates in early 2024.
Question & Answer:
Q1. How much percent Wholesale Price Index has been registered for the month of May 2023?
Q2. What is the special thing in WPI of May 2023?
Ans. It is the lowest of last seven and half year
Q3. What is the meaning of one basis point?
Ans. One-basis point is one-hundredth of a percentage point