March wholesale inflation as much as 8-year excessive of seven.39%

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The wholesale inflation charge rose to a greater than eight-year excessive of seven.39% in March, official knowledge launched on Thursday confirmed, on the again of elevated costs of crude oil, petroleum items and primary metals. A low base impact additionally contributed to the spike – wholesale inflation was 0.42% in March final yr. That is the very best stage since 7.4% in October 2012.

“We anticipate WPI inflation to proceed to rise for a couple of extra months, probably reaching double digits in Might, the primary time since September 2011,” mentioned Rahul Bajoria, chief economist, Barclays India.

Inflation as measured by the Wholesale Price Index was 4.17% in February and a couple of.51% in January.

The upper wholesale inflation is predicted to trigger an increase in retail inflation as properly, dampening prospects of any charge reduce quickly. Shopper inflation had risen to five.5% in March from 5% within the month earlier than. That is close to the highest of the Reserve Bank of India’s 2-6% goal inflation charge band.

“There may be negligible house for charge cuts to assist development, regardless of the rising uncertainty associated to the surge in Covid-19 circumstances, localised restrictions and rising issues concerning migrants returning to the hinterland,” mentioned Aditi Nayar, chief economist,

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