WPI Inflation Went 12 Years High At 14.23%, In November

The Wholesale price-based (WPI) inflation has rallied to 14.23% in November, while WPI stood at 12.54% in October. The Ministry of Commerce and Industry of the union government has released the country's WPI data on December 14. India has been dealing with a high CPI inflation rate since June-July, this year. The increasing WPI is another burden for the nation's economic development.

WPI data in November 2020 was at 2.29%, but since April 2021, the WPI inflation has stayed in double digits for 8 consecutive months. The WPI inflation in November is the highest in the last 12 years, since April 2005.

The Commerce and Industry Ministry said, "The high rate of inflation is primarily due to rise in prices of mineral oils, basic metals, crude petroleum, natural gas, chemicals products, and food." The fuel and power prices have increased 39.81%, while they rose 37.18% in October. The manufactured product (like Beverages, Tobacco Products, Apparel, Chemicals, Textiles, Pharmaceuticals, Basic Metals, Semi-Finished Steel) prices, have increased 11.92%, while it was 12.04% in October. The basket had earlier increased -7.01% in November 2020.

In an official comment to media, Suman Chowdhury, Chief Analytical Officer, Acuité Ratings & Research stated, "The WPI print for November highlights the underlying inflationary pressures in the economy that is not apparent in the headline CPI print."

The RBI, in the last week, completed its MPC meeting, and the RBI Governor assured to keep the inflation rate under control the increasing fuel price is one of the biggest reasons behind this surge.

Chowdhury added, "There has been a steep sequential rise in inflation of primary articles and fuel and power which stood at 5.6% for both categories which reflects the continuous rise in commodity prices including oil, coal and that of various metals. As seen in headline CPI, there has been a visible spurt in primary food articles due to the rise in vegetable prices; however, we believe this is likely to be transient due to the arrival of the Kharif crop in the market."