Extending its easing trendm India's inflation gauge, based on monthly WPI, softened to five months low of 5.19% for the monthe of July as compared to 5.43% in the previous month and 5.85% during the correspondig moth of the previous year. The figure was much in-line street expectations, which were expecting headline inflation to be in the range of 5.15%-5.19% for the month under review. Meanwhile, May inflation figures were revised upwards to 6.18% from 6.10% earlier.
The five-month low inflation data was mainly on account of moderation in fuel costs. Fuel & Power index, which occupies 14.91% weight in the overall index, rose by 1.1% to 214.7% (privisional) from 212.3 (provisional) for the previous month due to higher price of petrol and furance oil (3% each), bitumen and high speed diesel (2% each) and aviation turbine fuel (1%). Meanwhile, the index of Manufactured Products, which occupies the majority 64.97% weight in WPI index, rose by 0.3% to 155.4 (provisional) from 154.9 (provisional) in June.
However, Primary Articles index, which occupies 20.12% weight in the overall headline index, also rose 2.7% to 256.6 (provisional) from 249.9 (provisional) for the previous month. Out of the index, 'Food Articles' group rose by 3.6% to 258.6 (provisional) from 249.7 (provisional) for the previous moth, while index for 'Non-Food-Articles' group rose by 0.8% to 218.1 (provisional) from 216.4(provisional) for the previous month.
In an encouraging development, core inflation also softened to 3.32% v/s 3.49% in June. However of concern side, inflation in the overall food articles basket, stood at 8.43% as compared to 8.14% in June. The Reserve Bank in its monetary policy review last week had cautioned that continued uncertainty over monsoon could stoke food inflation, but expressed the hope that government policies will improve supplies in the coming months.
The five-month low inflation data was mainly on account of moderation in fuel costs. Fuel & Power index, which occupies 14.91% weight in the overall index, rose by 1.1% to 214.7% (privisional) from 212.3 (provisional) for the previous month due to higher price of petrol and furance oil (3% each), bitumen and high speed diesel (2% each) and aviation turbine fuel (1%). Meanwhile, the index of Manufactured Products, which occupies the majority 64.97% weight in WPI index, rose by 0.3% to 155.4 (provisional) from 154.9 (provisional) in June.
However, Primary Articles index, which occupies 20.12% weight in the overall headline index, also rose 2.7% to 256.6 (provisional) from 249.9 (provisional) for the previous month. Out of the index, 'Food Articles' group rose by 3.6% to 258.6 (provisional) from 249.7 (provisional) for the previous moth, while index for 'Non-Food-Articles' group rose by 0.8% to 218.1 (provisional) from 216.4(provisional) for the previous month.
In an encouraging development, core inflation also softened to 3.32% v/s 3.49% in June. However of concern side, inflation in the overall food articles basket, stood at 8.43% as compared to 8.14% in June. The Reserve Bank in its monetary policy review last week had cautioned that continued uncertainty over monsoon could stoke food inflation, but expressed the hope that government policies will improve supplies in the coming months.
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