WPI slide: Inflation falls to -1.21% in October; food prices see steep deflation – The Times of India

Wholesale inflation slid further into the negative zone in October, with the Wholesale Price Index (WPI) falling to (-)1.21%, as prices of food items, fuel and several manufactured goods continued to ease, latest government data showed on Friday.WPI inflation had stood at 0.13% in September and 2.75% a year earlier, according to PTI.According to the industry ministry, the decline reflects a broad-based correction led by food articles, crude petroleum and natural gas, electricity, mineral oils and basic metals. Food items saw deepening deflation of 8.31%, compared with 5.22% in September, driven by sharp drops in prices of onions, potatoes, vegetables and pulses.Vegetables recorded –34.97% inflation, pulses –16.50%, potatoes –39.88%, and onions –65.43% in October.Manufactured products witnessed softer inflation at 1.54%, down from 2.33% the previous month. Fuel and power remained in deflation at –2.55%, nearly unchanged from September’s –2.58%.Officials said wholesale prices have adjusted quickly to the GST rate cut implemented on September 22, which reduced tax slabs on mass-consumption goods to 5% and 18%. The lower tax burden, combined with a favourable base, has also pushed retail inflation to a historic low of 0.25% in October, down from 1.44% in September.With both WPI and CPI dropping sharply, economists expect pressure on the Reserve Bank of India to revisit its policy stance when the Monetary Policy Committee meets on December 3–5. The central bank held the repo rate steady at 5.5% last month.