The Crossbill News Desk
India's wholesale inflation accelerated sharply in May, with the Wholesale Price Index (WPI) rising to 9.68% from 8.26% in April, according to figures released by the Ministry of Commerce and Industry.
The latest reading marks the first release under the revised WPI series, which now uses 2022-23 as the base year.
The data indicates that producers and businesses are contending with substantially higher costs compared with a year ago. With the headline WPI inflation nearing double digits, the pressure is not confined to a single category but is visible across fuels, primary goods and manufactured products.
Among the various components, fuel and power registered the steepest increase. Inflation in the category climbed to 30.33% in May from 24.89% in April, Business Standard reported. Within this segment, crude petroleum and natural gas inflation rose to 61.51% from 56.31%, while mineral oils, including petrol, diesel and LPG, recorded inflation of 49.82%.
Primary articles inflation also picked up, increasing to 4.99% in May compared with 3.78% in the previous month. Inflation in manufactured products rose to 7.48% from 6.68%.
The broad-based rise in wholesale prices raises concerns that producers may eventually transfer part of the burden to consumers.
Although the Wholesale Price Index and Consumer Price Index track different baskets of goods, sustained and widespread increases in wholesale prices are often seen as a precursor to higher retail inflation.
Food prices at the wholesale level also showed an upward trend, with the WPI food index inflation rate rising to 4.49% in May from 3.11% in April. Government data points to not merely rising prices but an acceleration in the pace of wholesale inflation, as reflected in the WPI index.
Another consequence of elevated inflation is that it can inflate nominal GDP figures even without a corresponding rise in actual economic activity, particularly if growth slows. Higher prices may also push up tax collections, with possible spillover effects on employment, wages and salaries.
The latest reading marks the first release under the revised WPI series, which now uses 2022-23 as the base year.
The data indicates that producers and businesses are contending with substantially higher costs compared with a year ago. With the headline WPI inflation nearing double digits, the pressure is not confined to a single category but is visible across fuels, primary goods and manufactured products.
Among the various components, fuel and power registered the steepest increase. Inflation in the category climbed to 30.33% in May from 24.89% in April, Business Standard reported. Within this segment, crude petroleum and natural gas inflation rose to 61.51% from 56.31%, while mineral oils, including petrol, diesel and LPG, recorded inflation of 49.82%.
Primary articles inflation also picked up, increasing to 4.99% in May compared with 3.78% in the previous month. Inflation in manufactured products rose to 7.48% from 6.68%.
The broad-based rise in wholesale prices raises concerns that producers may eventually transfer part of the burden to consumers.
Although the Wholesale Price Index and Consumer Price Index track different baskets of goods, sustained and widespread increases in wholesale prices are often seen as a precursor to higher retail inflation.
Food prices at the wholesale level also showed an upward trend, with the WPI food index inflation rate rising to 4.49% in May from 3.11% in April. Government data points to not merely rising prices but an acceleration in the pace of wholesale inflation, as reflected in the WPI index.
Another consequence of elevated inflation is that it can inflate nominal GDP figures even without a corresponding rise in actual economic activity, particularly if growth slows. Higher prices may also push up tax collections, with possible spillover effects on employment, wages and salaries.
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