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WPI dips to 0.9% in Jan as food articles turn cheap

Reversing four months of a rising trend, the WPI inflation fell to (-) 0.9% in January as food articles, mainly vegetables and pulses, turned cheaper.

This was further contraction to the WPI inflation reading of -0.73% in December 2015.
This is the 15th straight month since November 2014 that deflationary pressure persisted and wholesale inflation has remained in the negative zone.

WPI inflation had come in at -0.95% in January last year.

Food inflation stood at 6.02% in January against 8.17% in December, according to official data which was released on Monday.

Inflation in pulses and onions eased to 44.91% and 5.51%, respectively. The rate of price rise in the case of vegetables was 12.52% in January and for fruits, it stood at -2.32%.

Price growth in potato was -17.08%, while that of egg, meat and fish came in at 5.69%.

Inflation print in the fuel and power segment was -9.21%, and for manufactured products, it read - 1.17% in January.

The November inflation has been revised to -2.04% from the provisional estimate of -1.99%.

Last week, data showed that retail inflation has been rising for six straight months and stood at nearly one-and-a-half-year high of 5.69% in January.

The central bank looks into mainly retail inflation data while firming up its monetary policy stance.

RBI also takes into account industrial production numbers. As per latest data, IIP contracted 1.3% in December against a decline of 3.4% in November.