Wholesale inflation hits 15-month high of 2.61%

New Delhi: Wholesale inflation reached a 15-month high of 2.61 per cent in May, driven by soaring food prices, especially vegetables, and increased costs of manufactured goods due to heatwave conditions.

The wholesale price index (WPI) based inflation has been climbing for three consecutive months. It was 1.26 per cent in the previous month and -3.61 per cent in May 2023.

The Ministry of Commerce & Industry stated on Friday that the positive rate of inflation in May 2024 is mainly due to higher prices of food articles, manufactured food products, crude petroleum and natural gas, mineral oils, and other manufactured goods.

This WPI figure marks a 15-month peak, the highest since February 2023 when inflation stood at 3.85 percent.

Data shows food article inflation surged to a 10-month high of 9.82 per cent in May.

Vegetable inflation climbed to 32.42 per cent in May, up from 23.60 per cent the previous month. Onion inflation was 58.05 per cent, while potato inflation was 64.05 per cent. Pulses saw a 21.95 per cent rise in May.

Additionally, rising global metal prices have led to increased inflation in the manufacturing sector. Inflation in manufactured products rose to 0.78 per cent in May from -0.42 per cent in April.

Inflation in the fuel and power category was slightly lower at 1.35 per cent in May, compared to 1.38 per cent in April.

The rise in WPI contrasts with retail inflation data for May. The Reserve Bank of India (RBI) primarily considers retail inflation when setting monetary policy.

Retail inflation fell to a one-year low of 4.75 per cent in May, according to data released earlier this week.

Earlier this month, the RBI kept the interest rate unchanged for the eighth consecutive time.