The indicator of price rise in wholesale markets has remained in double digits since April last year. In July last year, the wholesale inflation rate was 11.57%.
Wholesale inflation in the past month was driven primarily by the rise in prices of mineral oils, food articles, crude petroleum and natural gas, basic metals, electricity, chemicals and chemical products, food products etc, the ministry of commerce and industry said.
The inflation rate in food items declined substantially to 10.77% in July from 14.39% in June. Price rise in vegetables declined to 18.25%, as compared to 56.75% in June.
The rate of inflation in manufactured products also declined to 8.16% in July as compared to 9.19% in June.
However, wholesale inflation in the fuel and power category increased to 43.75% in July as compared to 40.38% in June.
On August 12, government data showed that retail inflation had eased to 6.71% in July from 7.01% in June.
Despite the decline, the price rise indicator remained above the upper limit of the Reserve Bank of India’s prescribed range for the seventh month. The central bank aims to keep retail inflation in the range of 2% to 6%.
On August 2, Finance Minister Nirmala Sitharaman had said that the Centre was not in denial about inflation in India and that it was taking steps to bring it under 7%.
“The Indian economy is in a better situation compared to the economies of developed nations,” Sitharaman had said in the Rajya Sabha. “But that does not mean the government is running away from saying... because of imported inflation and global commodity crisis, we are being impacted.”
However, the Reserve Bank of India on August 5 said that inflation is expected to remain above the central bank’s 6% threshold in the second and third quarters of this fiscal year.