Headline Inflation eased to a 26-month Low at 6.55% in January 2012 from 7.47% in December 2011

As per official data released on 14 February 2012, headline inflation eased to a 26-month low at 6.55 per cent in January 2012 from 7.47 per cent in December 2011 on the back of further fall in vegetable prices. The overall inflation, as measured by the wholesale price index (WPI), witnessed a sharpsharp fall in January, 2012, from 9.47 per cent in January 2011.

WPI data

The WPI data showed that food inflation was in negative zone at (-) 0.52 per cent in January 2012 owing to cheaper vegetables such as potatoes and onions, which were down 23.15 per cent and 75.57 per cent, respectively, year-on-year. However, prices of edible oils and milk in January increased up to 9.59 per cent and 12.6 per cent, respectively. The prices of eggs, meat and fish was also registered to be higher by 18.63 per cent on a yearly basis. Food articles have a 14.3 per cent weight in the WPI basket
Moreover, manufactured goods, which account for a weight of about 65 per cent in the WPI basket, continued to cost more. Inflation in manufactured items stood pegged at 6.49 per cent in January year-on-year, as against 7.41 per cent in December 2011.

Inflation in overall primary articles, however, stood lower at 2.25 per cent in January 2012 as compared to 3.07 per cent in December 2011 while in non-food primary articles, it moderated to 0.55 per cent from 1.48 per cent in December 2011.

Fuel and power inflation rose 14.21 per cent from a year before, compared with 14.91 per cent in December. Primary articles index rose 2.25 per cent in January 2012 compared with 3.07 per cent in December 2011.