Inflation, based on wholesale prices, rose to a record high of 12.94 in May, driven by rising prices of crude oil and manufactured goods. WPI inflation rose sharply in May 2021 due to a low root effect. WPI inflation rose to 3.37 per cent in May 2020. Wholesale price index (WPI)-based inflation is the fifth consecutive month. In April 2021, WPI inflation stood at 10.49 per cent in double digits.
“The annual WPI-based annual inflation rate rose to 3.94 per cent in May 2020 from 12.37 per cent in May 2020,” the Commerce Ministry said in a statement. “The high rate of inflation in May 2021 is mainly due to lower prices and prices of petroleum products and prices of petrol, diesel, naphtha, furnace oil compared to the same month last year.”
The monthly WPI-based annual inflation rate is 12.94% (provisional) for the month of May 2021, compared to 10.49% in April 2021: Ministry of Commerce and Industry pic.twitter.com/qzXLm37T9A
– ANI (@ANI) June 14, 2021
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Fuel and electricity inflation increased to 37.61 per cent during the period under review, from 20.94 per cent in April. Inflation in manufactured products stood at 10.83 per cent in May, up from 9.01 per cent in the previous month. Food inflation fell to 4.31 per cent in May. However, onions became expensive during this period. Earlier this month, the RBI said its monetary policy had kept interest rates at a record high and was committed to maintaining a soft policy to boost growth.
What is inflation?
The increase in prices compared to the money available in a given period is called inflation or inflation. Suppose you are buying a plate of chole masala for Rs 100 today. If the annual inflation rate is 10%, you will be buying the same for 110 rupees next year. Unless your income is relatively high, you will not be in a position to buy these or any other items.