Annual inflation at 0.18% on April 4

NEW DELHI: The wholesale price index rose 0.18 per cent in the 12 months to April 4, below the previous week's annual rise of 0.26 per cent, government data showed on Thursday.

It was above a median forecast for a fall of 0.18 per cent in a Reuters poll of analysts.

The annual inflation rate was 7.71 per cent during the corresponding week of the previous year.

The wholesale price index is more closely watched than the consumer price index, which is published monthly, because it covers a higher number of products and is released weekly.

If realised, it would be for the first time India's wholesale price-based inflation rate has been below zero since annual records started in 1977/78 and comes eight months after inflation peaked at 12.91 per cent in early August.



Annual inflation will turn negative even though the WPI index is actually forecast to rise slightly from the previous week, reflecting a sharp jump in the index a year ago when price rises were accelerating.

However, the index has been on a downward trend since last September before steadying in March.

"We expect deflation to continue till October," said Jyotinder Kaur, an economist at HDFC Bank.

"The sharpest deflation points will be seen in July and August with an expected inflation of -3.6 per cent and -3.4 per cent respectively," she said.

The weekly wholesale price index is more closely watched than the monthly consumer price index (CPI) because it includes more products and is published on a more frequent basis.