Coal news and updates

Inflation at -3.81% in October; pulses, onion dearer

India Coal Market Watch

 November 16: Deflationary pressure eased a bit with the inflation rate moving up slightly to -3.81% in October as pulses, vegetables and onions turned costlier.

This is 12 months in a row when inflation at a wholesale level remained in negative territory. It has been in the negative zone since November last year.

The Wholesale Price Index-based inflation was -4.54% in September. In October last year, it was 1.66%.

 Pulses and onion among the food items category turned costlier with inflation at 52.98% and 85.66% respectively during October.

The rate of price rise in case of vegetables was at 2.56% as against -19.37% in the same month last year, as per official data.

Besides pulses and onions, the food items which became dearer during the month were milk (1.75%) and wheat (4.68%). However, the inflation rate in case of potato was in the negative zone, -58.95%.

The inflation rate in fuel and power was -16.32%, while that in manufactured products was -1.67% in September.

Inflation for August has been revised to -5.06%, from the provisional estimate of -4.95%.

The Reserve Bank of India (RBI) would take into account the WPI number for October while deciding on the policy rate in its December 1 monetary policy review. The RBI mostly tracks the consumer price index-based retail inflation for its monetary policy decisions.

Rising for the third straight month, retail inflation has climbed to 5% in October, as against 4.62% in the same month a year ago due to costlier pulses and other food items.

RBI Governor Raghuram Rajan earlier this month had said that the central bank is comfortable with the current rate of interest till further room is available.

In September, the RBI had reduced interest rates by more than expected 0.50% and said it expects the CPI inflation to reach 5.8% in January 2016.