WPI inflation rises to 2.93% in Feb as food and fuel prices harden

Wholesale price index (WPI)-based inflation rose to 2.93% in February against 2.76% in January, as prices of primary articles, fuel and power hardened last month, according to a government data release.

Wholesale food prices in February rose 3.29% year-on-year, the data showed.

According to Care Ratings, the increase was led by food and non-food articles with inflation in food articles rising at 4.3% in February, higher than 1% witnessed in the corresponding period last year. This is the second consecutive month where inflation in food articles registered a positive trend after witnessing a persistent deflation during July-December 2018 period.

Primary articles, including kitchen essentials like potato, onion, fruits, and milk, increased to 4.84% during the month, as against 3.54% in January, the data revealed.

Owing to lower crude oil prices in the market, fuel prices moderated to 2.2% during the month compared to a rise of 4.6% in the year-ago period.

The Reserve Bank of India (RBI), which mainly factors in retail inflation-based Consumer Price Index (CPI), had cut the key lending rate by 0.25% in February. Experts believe the central bank could look at another rate cut in the upcoming monetary policy meeting since retail inflation for February 2019, which was announced on Tuesday, showed a rise of 2.57%.