Performance of the WPI Numbers for June 2022 By Mr. Mohit Ralhan, TIW Capital group
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Perspective on the WPI Numbers for June 2022 by Mr Mohit Ralhan, Managing Partner, TIW Capital Group
“While the WPI inflation eased out slightly to 15.18% in June in comparison to 15.88% in May, it remains at elevated levels mirroring the macroeconomic scenario across the globe. The most notable is an increase in the WPI food index from 10.89% in May to 12.41% in June, which indicates that the central government took the right call of banning wheat exports. On the other hand, the decline in manufactured product inflation indicates that industry-level supply issues are inching towards resolution. Increasing food prices across the globe have now become the major driver of inflation ahead of energy prices. Also, food production and supply have a longer cycle and therefore it may persist for more time. Given that India is a major food producer, it is much better placed to tide over this challenge. We continue to expect a higher level of inflation at least in this calendar year and therefore central banks around the world, are likely to continue raising policy rates and even accelerate the same to keep the economy in balance.”
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