WPI Inflation in June 2024: India’s wholesale price inflation in June 2024 rose to a 16-month high of 3.36 per cent on costlier food items, as compared with 2.61 per cent in the previous month of May 2024, according to the latest official data released on Monday.
“The annual rate of inflation based on all India Wholesale Price Index (WPI) number is 3.36% (Provisional) for the month of June, 2024 (over June, 2023). Positive rate of inflation in June, 2024 is primarily due to increase in prices of food articles, manufacture of food products, crude petroleum & natural gas, mineral oils, other manufacturing etc,” the Ministry of Commerce and Industry said in a statement.
Aditi Nayar, chief economist and head (research and outreach) at ICRA, said, “The jump in the WPI inflation to 3.4% in June 2024 was broad-based, and along expected lines, displaying the third consecutive month of a sizeable sequential step up (+0.3% in March 2024, +1.2% in April 2024 and +2.6% in May 2024). Looking ahead, the headline WPI inflation is expected to dip to ~2.0% in July 2024, driven by a favourable base, as well as some cooling in global commodity prices.”
The upmove in the WPI inflation in June 2024 was broad-based, driven by all the major segments except fuel and power, she added.
“After rising to seven-month high levels in May 2024, global commodity prices have seen a continuous dip. The Bloomberg commodity price index has eased by 0.9% sequentially to average at 101.2 during July 1-12, 2024 from 102.2 in June 2024 (-1.6% MoM). Notably, in YoY terms, the index contracted by 3.4% in July 2024 (up to July 12, 2024) as against an expansion seen during the previous two months (+0.6% in June 2024; +2.5% in May 2024). This augurs well for the WPI inflation print in the month,” Nayar said.
The average price of the Indian basket of crude oil has been quite volatile in July 2024 so far, on the back of supply-demand mismatches, witnessing an MoM rise ($86.6/bbl up to July 11). Higher crude oil prices might exert an upward pressure to the headline WPI inflation in the ongoing month, she added.
In June 2024, India’s CPI inflation in June 2024 also rose to 4-month high of 5.08 per cent on the back of higher food prices, according to official data released on Friday, July 12.
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