India’s wholesale price-based inflation in September accelerated more than expected to hit 7.81 percent on year, as the government’s fuel price increase took effect, giving rise to a complex situation for the central bank ahead of its policy review on 30 October.
In August, WPI inflation was 7.55 percent and In September 2011.
Fuel group inflation rose 11.8 percent against 8.32 percent in August, primary articles inflation rose 8.77 percent from 10.08 percent and that of manufactured products 6.26 percent from 6.14 percent.
The government also revised the July print to 7.52 percent from the provisional 6,87 percent.
Reacting to the higher inflation figures, Planning commission deputy chairman Montek Singh Ahluwalia said it is above comfort level of the panel which is 5-6 percent.
A Reuters poll had seen the figure at 7.70 percent.
“Given the fact that we have had some correction in diesel prices, it is very natural that inflation would have moved higher,” Indranil Pan, chief economist at Kotak Mahindra Bank, was quoted as saying in the report.
Read the full press release here.