New Delhi: India’s wholesale price inflation rose to 2.36% year-on-year in October, marking the highest level in four months due to escalating food prices, according to government data released on Thursday. This figure surpassed the 2.2% rate forecasted by economists in a Reuters poll, showing an increase from September’s inflation rate of 1.84%.
Food prices saw a sharp 11.6% year-on-year increase in October, up from a 9.5% rise in September. Vegetable prices were a significant contributor, surging by 63% compared to the 48.7% rise in the previous month. Cereal prices also climbed, albeit at a slightly reduced pace, growing by 7.9% year-on-year versus 8.1% in September. Meanwhile, prices for manufactured goods rose by 1.5%, compared to a 1% increase in September.
In contrast, fuel and power prices dropped by 5.8%, extending the 4% decline observed in the previous month.
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Retail inflation—closely monitored by India’s central bank for interest rate decisions—has averaged around 5% over the past year. However, food inflation has remained elevated, consistently above 8%, driven by price spikes in vegetables, cereals, and other essentials due to weather disruptions.
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In October, retail inflation reached a 14-month peak of 6.2%, with food prices up by 10.9%, dampening hopes of an interest rate cut. Although the Reserve Bank of India (RBI) had softened its stance to “neutral” in October, Governor Shaktikanta Das clarified that this shift did not imply an imminent rate reduction.
