The Wholesale price-based inflation (WPI) in India climbed to the highest in more than two years as commodity prices rose. The WPI inflation rose for the second consecutive month to a 27-month high of 4.17percent in February, as food, fuel and power prices spiked.

 The WPI inflation was 2.03percent in January and 2.26percent in February last year. After witnessing months of softening of prices, the food articles in February saw 1.36percent inflation. In January it was (minus) – 2.80percent. In vegetables the rate of price rise was -2.90percent in February, against -20.82percent in the preceding month. Inflation in pulses was 10.25percent in February, while in fruits it was 9.48percent. Inflation in the fuel and power basket was 0.58percent in February, against  - 4.78percent in January on rising prices of petrol and diesel.

Petroleum product prices have reached historic highs as international crude prices have surged in recent months and due to high indirect taxes both at the centre and state level. ICRA Ltd Principal Economist Aditi Nayar said the doubling in the WPI inflation in February reflects the rise in commodity prices brought on by the global risk-on sentiment, hardening of crude oil and fuel prices, as well as a fading of the favourable base effect for food items. Core inflation was at 5.5percent in February.

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