WPI inflation cools to three-month low of 1.89% in November

India's wholesale price inflation (WPI) eased to a three-month low of 1.89 per cent in November, driven by a significant fall in food and vegetable prices, according to data released by the Ministry of Commerce and Industry on Monday. This is a decline from 2.36 per cent in October and a sharp contrast to 0.39 per cent recorded in November last year.

Food price inflation decelerated to 8.63 per cent in November from 13.54 per cent in the previous month, largely due to a steep drop in vegetable prices, which fell to 28.57 per cent from October's 63.04 per cent. Notably, onion prices saw a decline of 2.85 per cent.

In the fuel and power category, deflation deepened slightly to 5.83 per cent in November, compared to 5.79 per cent in October. Meanwhile, inflation in manufactured products rose to 2 per cent from 1.50 per cent the previous month, reflecting increased prices in segments like food products, textiles, and machinery.

The Ministry stated that the positive rate of inflation in November was driven by higher prices of food articles and other manufactured goods.

This WPI trend aligns with the easing retail inflation, which fell within the Reserve Bank of India’s (RBI) target band at 5.48 per cent in November, down from October's 6.21 per cent. The RBI recently kept its benchmark repo rate unchanged at 6.5 per cent for the 11th consecutive time, adopting a neutral stance.

The drop in wholesale and retail inflation rates has raised hopes of a policy rate cut in the RBI’s upcoming February review, signalling a potential relief for businesses and consumers alike.