In May, the wholesale price index (WPI) based inflation hit an all-time high of 12.94 percent owing to the rise in crude oil prices and crude oil manufactured products. It is for the fifth consecutive month that the WPI has breached the higher levels.
In April it was at 10.49 percent, which was 11-year high. Apart from the rise in prices of crude oil and manufactured products, the low base effect is also responsible for the higher inflation of the WPI in May 2021. In May 2020, the WPI inflation was at (-3.37) percent.
The manufactured products inflation rose to 10.8 percent in May 2021, which is 9 percent higher than the previous month, while core inflation spiked to 10 percent, which was 8 percent in April 2021.
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The Commerce and Industry Ministry said, “The high rate of inflation in May 2021 is primarily due to low base effect and rise in prices of crude petroleum, mineral oils i.e. petrol, diesel, naphtha and furnace oil among other things as well as manufactured products as compared to the corresponding month of the previous year.”
In May 2021, Fuel and power inflation also went up at 37.6 percent, which was at 20.94 percent in April 2021.
However, the food prices witnessed a slight fall and were at 4.31 percent in May 2021. At the same time, onion prices showed a jump and were at 23.24 percent in May 2021, they were in negative numbers in April 2021, at (-19.72) percent.