Wholesale prices fall for 15th mth

General wholesale prices fell for the 15th straight month in January this year. The rate of decline in the wholesale price index (WPI), called deflation in technical parlance, rose to 0.90 per cent in the month compared to 0.73 per cent in December 2015, official data showed on Monday. However, the deflation was lower than 0.95 per cent in January 2015.

The WPI deflation was in contrast with consumer price index-based inflation, which rose to a 17-month high of 5.69 per cent in January from 5.61 per cent in the previous month. It was way back in 1975-76 there was WPI-based deflation for a full year. The index had last showed inflation in October 2014, at 1.66 per cent. However, food articles remained in an inflationary zone, even as the rate of price increase declined. The inflation here decelerated at 6.02 per cent in January, compared to the 8.17 per cent rise seen in the previous month. Pulses, which have consistently provided the main inflationary push among food articles in FY16, continued to rise 44.91 per cent, although inflation mellowed from the 55 per cent rise witnessed in December. Inflation in vegetables declined to 12.52 per cent in January, compared to 20.56 per cent in the previous month.

Aditi Nayar, chief economist at Icra, said: "Notwithstanding correction relative to the previous month, inflation for pulses, vegetables and spices remained uncomfortably high in January."