Corporates call for rate cut in wake of WPI dip

Data from the Ministry of Commerce and Industry said the wholesale price index (WPI), with the revised base year of 2011-12, decelerated further in May 2017 to 2.17 per cent from 3.85 per cent in April as food prices eased. The wholesale prices had decelerated in April to 3.85 per cent from 5.11 per cent reported for March. However, the WPI in May 2016 declined to (-) 0.90 per cent. 

The base year of the current WPI, which was revised last month from 2004-05 to 2011-12, does not include indirect taxes, thus, decreasing volatility in inflation at wholesale level. 

On a year-on-year (YoY) basis, expenses on primary articles, which constitute 22.62 per cent of the WPI’s total weightage, declined by (-) 1.79 per cent as compared to a rise of 4.38 per cent during the same month a year ago. The prices of food articles slipped by (-)2.27 per cent during the month under review. 

The wholesale inflation rate for onion was lower year-on-year by (-)12.86 per cent, while that for potatoes plunged by (-) 44.36 per cent. Overall, vegetable prices in May declined by (-) 18.51 per cent, against a rise of 13.93 per cent in the same month a year ago.