New Delhi: Wholesale price index-based inflation accelerated for the third straight month in June hitting 1.62 percent on costlier food and manufactured items.
The hardening of the WPI index follows an uptick in retail inflation, announced on Tuesday, which hit a 22-month high of 5.77 percent in June, dampening chances of a rate cut by RBI at its next policy meet scheduled for 9 August.
Also, the annual rate of wholesale inflation is way higher than 0.79 percent in May and (-)2.13 percent in June 2015. Food inflation rose 8.18 percent in June due to higher price of fruits, vegetables, cereals as well as protein-rich items, showed government data which were released today.
The inflation in vegetables remained stubborn, which jumped 16.91 percent. The print for pulses came in at 26.61 percent while potatoes turned costlier by as much as 64.48 percent in June.
There was some source of comfort though as onion prices declined significantly with a reading of (-)28.60 percent during the month. Besides, fuel and power and minerals showed a price decline at (-)3.62 percent and (-)20.75 percent, respectively. In the manufactured items category, inflation read 1.17 percent.
"Rate cut by RBI in August is definitely a no. RBI is likely to maintain a status quo for a significant period of time," said Indranil Pan, Chief Economist, IDFC Bank.