Prime Minister Narendra Modi's claim during his Independence Day speech that his government has tamed inflation got punctured in about 24 hours by the wholesale inflation data for July: the WPI inflation doubled to 3.55 percent in July, in the process hitting a two-year high.
Statistics published by the BJP-led NDA government on Tuesday showed that WPI inflation shot up to 3.55 percent last month on account of a spike in food prices, ranging from pulses to fruits and vegetables. The rate stood at 1.62 percent in June.
The wholesale prices of food articles climbed 11.82 percent on a year-on-year (YoY) basis, with the sharpest spike seen in pulses (35.76 percent) and vegetables (28.05 percent). Sugar prices skyrocketed 32.33 percent, YoY.
"The annual rate of inflation, based on monthly WPI, stood at 3.55% (provisional) for the month of July, 2016 (over July, 2015) as compared to 1.62% (provisional) for the previous month and -4.00% during the corresponding month of the previous year," the ministry of commerce and industry said in a statement.
"The index for 'Food Articles' group rose by 2.4 percent to 285.8 (provisional) from 279.0 (provisional) for the previous month due to higher price of gram (20%), fruits & vegetables (7%), egg (5%), maize (3%), barley (2%) and coffee, beef & buffalo meat, jowar, wheat, urad, rice, masur and pork (1% each)," it added.