August 2022 WPI Inflation: A significant improvement, with wholesale inflation falling to 12.41% in August.

On Monday, the market started to heat up due to anticipation of an increase in inflation as retail inflation remained above 7%. It is anticipated that soon the cost of numerous items on the market may decrease due to the drop in wholesale inflation.

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The average person can soon experience relief from inflation, even though retail inflation (CPI Inflation) increased during the month of August. At 12.41% in August, wholesale price inflation (WPI) decreased for the third consecutive month. WPI-based inflation was 13.93% in July and 11.64% in August of the previous year.

The Wholesale Price Inflation (WPI) has been above 10 percent for 17 months running. Let us inform you that the Wholesale Price Index reached a new high of 15.88% in May of this year.

how events occurred

From 10.77% in July to 12.37% in August, food prices increased. During this time, vegetable prices rose by 22.29% compared to July’s 18.25% increase. The basket of prices for fuel and electricity increased by 33.67% in August compared to 43.75% in July. It was 7.51 percent for ready-made goods and (-) 13.48 percent for oilseeds, respectively. This indicates that oilseed prices have dropped significantly.

retail inflation of 7%

The Reserve Bank of India (RBI) may use retail inflation as a benchmark when determining its monetary policy even while wholesale inflation has reduced. For the seventh consecutive month, retail inflation was above the Reserve Bank’s maximum tolerance zone of 6%. August saw a 7% increase in prices.

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What will RBI’s upcoming action be?

The RBI has raised the benchmark interest rate three times this year, to 5.40%, in an effort to contain inflation. According to predictions made by the central bank, retail inflation will likely average 6.7% in 2022–2023.

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