The annual rate of inflation based on the wholesale price index (WPI) hit a five-year low of 3.74 per cent in August, helped by declining prices of vegetables and other food articles across the country.
Food price inflation witnessed a significant decline to 5.15 per cent in August, from 8.43 per cent in the previous month, data released by the Central Statistics Office (CSO) today showed.
Vegetable prices contracted 4.88 per cent, extending the fall to the third continuous month, in August. Onion prices contracted by 44.7 per cent during the month. However, potato prices were on the rise as inflation in essential commodities jumped to 61.61 per cent in August from 46.41 per cent in July.
The WPI inflation in August 2014 was the lowest since the October 2009 level when it stood at 1.8 per cent.
India's wholesale price inflation stood at 5.19 per cent in July this year and 6.99 per cent in August 2013.
Build-up of the rate of inflation in the financial year so far has been 3 per cent compared to a build-up of 5.23 per cent in the corresponding period of the previous year.
The index for the 'primary articles' group, which has a weight of 20.12 per cent in the WPI, rose 2.0 per cent from the previous month.
Among primary articles, the index for the 'food articles' group rose 2.6 per cent due to higher prices of fruits and vegetables, urad and condiments and spices, arhar, barley and milk, masur, gram and ragi and jowar, rice, coffee, poultry chicken, fish and wheat. However, the price of tea, fish, maize and pork and egg and bajra declined.
The index for the 'non-food articles' group rose 0.3 per cent due to higher price of flowers, copra (coconut), gingelly seed, niger seed, groundnut seed and linseed and castor seed, rape and mustard seed and cotton seed. However, the price of raw rubber, soyabean, raw silk and raw jute, raw cotton, fodder and sunflower declined.
The index for the 'minerals' group rose 0.3 per cent due to higher price of barytes, iron ore, steatite and magnesite and chromite. However, the price of sillimanite, copper ore and, zinc concentrate declined.
The index for the `fuel and power' group (weight of 14.91 per cent in WPI) declined by 0.3 per cent due to lower price of petrol and furnace oil and bitumen. However, the price of high speed diesel moved up.
The index for the `manufactured products' group (weight of 64.97 per cent) rose by 0.3 per cent.
Among manufactured products, the index for the 'food products' group rose 0.1 per cent due to higher price of coffee powder, copra oil, gram powder (besan) and sugar, khandsari and sooji (rawa). However, the price of tea dust (blended), mixed spices and tea leaf (blended) and bakery products, soyabean oil, gur and gingelly oil declined.
The index for the 'beverages, tobacco and tobacco products' group rose 0.5 per cent due to higher price of dried tobacco, chewing tobacco and beer and rectified spirit.
The index for the 'textiles' group rose 0.1 per cent due to higher price of tyre cord fabric, jute sacking cloth and manmade fabric and jute yarn and manmade fibre. However, the price of gunny and hessian cloth and cotton yarn and jute sacking bag declined.
The index for the 'paper and paper products' group rose 0.2 per cent due to higher price of paper cartons / boxes and printing and writing paper.
The index for the 'leather and leather products' group rose 1.7 per cent due to higher price of leather footwear.
The index for the 'rubber and plastic products' group rose 0.2 per cent due to higher price of plastic films and sheets, football, rubber footwear, reclaimed rubber, plastic rolls and HDPE bag. However, the prices of plastic containers and HDPE woven sacks and PVC rigid and polyester chips declined.
The index for the 'chemicals and chemical products' group rose 0.5 per cent due to higher price of rubber chemicals, pesticides and agarbattis, explosives, turpentine oil, synthetic resin, dyes and dye intermediates, vitamins, washing soap, organic manure, basic organic chemicals, basic inorganic chemicals and non-cyclic compound. However, the price of lacquer and varnishes, paints and washing powder declined.
The index for the 'non-metallic mineral products' group rose 0.8 per cent due to higher price of marbles and grey cement and railway sleeper. However, the price of bricks and tiles declined.
The index for the 'basic metals, alloys and metal products' group declined by 0.2 per cent due to lower price of wire rods and pig iron, melting scrap and sponge iron, rounds, plates, steel rods, angles, pencil ingots, CRC, gold and gold ornaments, joist and beams, fixtures and ferro chrome. However, the price of steel castings, ferro manganese and nuts/bolts/screw/ washers and aluminium, silver and rebars moved up.
The index for the 'machinery and machine tools' group rose 0.4 per cent due to higher price of PVC insulated cable, heat exchangers, grinding/wet coffee machinery and loader and conductor, insulators, electric switch gears, pumps and assembly, electric switches and battery dry cells. However, the price of washing / laundry machines, ball/roller bearing and microwave oven and fibre optic cable, material handling equipments and machine tools declined.
The index for the 'transport, equipment and parts' group rose 0.1 per cent due to higher price of bi-cycles and bus / mini bus / truck.
The CSO also revised the wholesale price index numbers for June 2014 to 5.66 per cent against the 5.43 per cent reported earlier in the light of revised wholesale prices rates for the month.