InvestorQ : Why has the WPI inflation dipped steep into the negative in the month of May 2020?
Mary Joseph made post

Why has the WPI inflation dipped steep into the negative in the month of May 2020?

Answer
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sara Kunju answered.
3 months ago


For the month of May, the Government reported WPI inflation at -3.21%, showing the first month of WPI deflation in a long time. There was no official WPI announcement made for April due to paucity of data. WPI Inflation shows whether producers are getting a better price or not but this can be misleading at times like these when most of the data points are under stress. WPI inflation in the three key subgroups viz. Primary Articles, Fuel & Power and Manufactured Products were in negative territory. Interestingly only food inflation carved out from Primary Article group was in positive zone. For the month of May, the CPI inflation has been announced for food but not for core or headline inflation. The CPI food inflation for May came in at 9.28%. Manufactured products inflation deflated -0.42% in May as a larger number of pink slips were handed out and most of the MSMEs suffered in the bargain.