India's November wholesale price inflation spikes to 12-year-high of 14.23%

Led by a sharp jump in the prices of oil, basic metals, and food products, India's wholesale price-based inflation (WPI) climbed to 14.23 per cent in November, the highest level in 12 years.

"The annual rate of inflation is 14.23 per cent (Provisional) for the month of November 2021 (over November 2020) as compared to 2.29 per cent in November 2020," the Ministry of Commerce and Industry said in a statement. The high rate of inflation in November 2021 is primarily due to the rise in prices of mineral oils, basic metals, crude petroleum and natural gas, chemicals and chemical products, food products, etc. as compared to the corresponding month of the previous year.

There has been a rising trend in inflation in recent months due to a sharp increase in power and fuel prices. WPI inflation stood at 12.54 per cent in October and 11.80 per cent in September this year.

Wholesale fuel and power prices surged 39.81 per cent in November on a year-on-year basis. The wholesale fuel and power inflation stood at 37.18 per cent in October.

Manufactured products, which have 64.23 per cent weight in the WPI, became costlier by 11.92 per cent in November when compared with the price level in the corresponding month last year. Wholesale manufactured products inflation stood at 12.04 per cent in October and 11.57 per cent in November.

The increase in prices is mainly contributed by the manufacture of basic metals; chemicals and chemical products; textiles; other non-metallic mineral products and paper and paper products. Some of the groups that have witnessed a decrease in prices are the manufacture of food products; other manufacturing; electrical equipment; tobacco products and leather and related products.

The rate of inflation based on the WPI Food Index increased from 3.06 per cent in October 2021 to 6.70 per cent in November 2021. The WPI food index, which has 24.38 per cent weight in the WPI, consists of food articles from the primary articles group and food products from the manufactured products group.