WPI inflation plunges to 5.70% in March vs 6.55% in February

New Delhi: Wholesale inflation eased to 5.70 percent in March on softening prices of pulses, potato and onion, making the case for a rate cut in August even stronger.

The wholesale price-based inflation, reflecting the annual rate of price rise, in February stood at 6.55 percent. In March 2016, WPI inflation was (-)0.45 percent.

Wholesale Price Index (WPI) inflation in pulses continued to witness deflationary pressures and was recorded at (-)6.09 percent in March.

This was aided by inflation data for potato and onion, which were at (-)17.07 percent and (-)10.78 percent respectively.

Overall, the food inflation basket showed marginal increase with inflation at 3.12 percent in March, as against 2.69 percent in February.

The Reserve Bank in its monetary policy review on April 6 kept the repurchase or repo rate -- at which it lends to banks -- unchanged at 6.25 percent, but increased reverse repo rate to 6 percent from 5.75 percent.