India April WPI snaps 17-mos fall, up 0.34% on upswing in commodity prices

India’s wholesale price index rose, snapping a 17-month fall in April, largely due to rise in global commodity prices amid India Inc regaining some pricing power.

WPI for the month of April rose 0.34 pct compared to -0.85 pct in the previous month ending March, 2016, as primary articles index rose 2.34 pct, manufactured product index rose 0.71 pct and fuels index fell 4.83 pct, data released by the Ministry of Commerce and Industry showed today.

In February, the index was down 0.91%, while in March 2015 it had fallen 2.33 pct. The WPI figure for January has been revised to -1.07 pct from -0.90 pct. Food inflation jumped to 4.23 per cent as compared with 3.73 per cent in March as pulses and potato became costlier. The mineral prices were down by 27.2 per cent, the data further showed.

Meanwhile, analysts expect the Reserve Bank of India Governor Raghuram Rajan to infuse another 25 bps rate cut in 2016 to nurture growth. However, the apex bank governor may wait to see if the monsoons arrive to reduce food prices and headline inflation falling on track, reports confirmed.

The index of industrial production (IIP) slowing to 0.1 pct in March from 2 pct in February as manufacturing fell 0.1 pct while mining fell 0.1 pct and electricity was up 11.3 pct. During FY16, IIP rose just 2.4 pct with manufacturing expanding by 2 pct, mining 2.2 pct and electricity 5.6 pct, the Ministry statement showed.

The RBI has projected a GDP growth of 7.6 pct in FY17, in-line with expectations by the government’s Economic Survey of GDP growth at 7-7.75 pct, compared to CSO’s projection of 7.6 pct in FY16.ver, consumer price index-led inflation has been projected at 5 pct by the Central Bank.