NEW DELHI: India's wholesale inflation surged for the eighth consecutive month to 9.7% in May from 8.3% in April, driven by high prices of crude oil and manufactured products, according to the newly released wholesale price index (WPI) series with the updated 2022-23 base year, published Monday.
Producer Price Index Unveiled
The Department for Promotion of Industry and Internal Trade (DPIIT) also released the maiden producer price index (PPI), covering output and input manufacturing prices as well as prices of seven services: banking, securities transactions, insurance, management of pension funds, railways, air passengers, and telecom. The PPI estimated inflation at 9.4% in May, driven largely by mining and quarrying (19%) and manufactured products (11.3%).
Divergent Trends in WPI Components
In the WPI, prices of crude petroleum and natural gas accelerated 61% in May, compared to 56% in April. Similarly, mineral oil prices rose 50% during the month, reflecting the impact of supply chain disruptions from the prolonged conflict in West Asia. Bank of Baroda chief economist Madan Sabnavis said, "If prices do come down sharply as has been seen today, there can be moderation in WPI inflation for sure on this account."
Factory gate prices for manufactured products rose 7.5% in May from 6.7% in April, led by acceleration in industries such as food products, textiles, leather, chemicals, electrical equipment, and basic metals. The weightage for manufactured products has slightly decreased to 63.1% in the new series.
Food Prices Also Rise
Wholesale prices of food items also saw an increase in May, with the food index rising to 4.5% from 3.1% in April.
New WPI Series Features
The new WPI series has expanded its coverage of items to 957 from 697. New energy sources, such as solar and wind, along with nuclear power, have been added under the electricity group. The new series shows that wholesale inflation stood at 0.4% in FY26.
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