WPI inflation drops to 5-year low of 2.38% in September

Zee Media Bureau

Declining prices of vegetable and other food articles pulled down wholesale inflation sharply to 2.38 percent in September compared to 7.05 percent during the corresponding month of the previous year.

The inflation measured on Wholesale Price Index (WPI) was at 3.74 percent in August.

The Sept WPI inflation is the lowest since October 2009 when it stood at 1.8 percent.

Retail inflation, which is a relatively new index, but gets more attention because the Reserve Bank of India has put it at the centre of its monetary policy focus, dropped to 6.46 percent in September, lowest since the new series of Consumer Price Index was released in January 2012, data released on Thursday showed.

Although retail inflation, which has been on decline since July, is below the RBI target of 8 percent by January 2015, experts said the central bank is expected to reduce interest in the next fiscal (2015-16) only.

The overall food inflation as measured by CPI fell to 7.67 percent as against 9.35 percent in the previous month and 11.75 percent in September 2013.

The retail inflation was at 7.73 percent in August, revised downward from the earlier estimate of 7.8 percent.

With agency inputs