India's wholesale inflation rises to 2.37%

India's wholesale price inflation climbed to 2.37% in December 2024, according to the Ministry of Commerce and Industry's latest data. The increase was primarily attributed to rising prices in food articles, food product manufacturing, and textile production.
The food index showed mixed trends, declining from 200.3 in November to 195.9 in December 2024. While cereals, pulses, and wheat prices decreased, vegetable inflation remained elevated at 28.65%. Notably, potato prices surged by 93.20%, and onions increased by 16.81%. The meat, fish, and eggs segment saw inflation rise to 5.43% from November's 3.16%.
Manufacturing sector inflation increased slightly to 2.14% from 2% in November. The fuel and power category continued to experience deflation, though at a reduced rate of 3.79% compared to November's 5.83%.
This wholesale inflation report follows recent retail inflation data, which showed the Consumer Price Index (CPI) easing to a 4-month low of 5.22% in December from 5.48% in November.
The data highlights the interconnected nature of various price indices. Currently, India primarily relies on WPI and CPI for policy decisions, with WPI tracking wholesale prices and CPI measuring retail-level prices. However, there are discussions about implementing a Producer Price Index (PPI) system, which would track prices at the production stage. Sources indicate that India is evaluating a PPI model, following the practice of most developed nations.