New Delhi, Jan 23: There has been a decline in the Wholesale Price Index (WPI) inflation in the month of December, which is an encouraging sign considering that slowdown in the economy that country had witnessed.
“The decline in WPI inflation in the month of December is inspiring and is a positive sign at this juncture, when the economy is facing severe macroeconomic challenges,” said Sharad Jaipuria, President, PHD Chamber, in a press statement recently.
“Since the industry’s growth is on the negative trajectory, it is inevitable to reduce the repo rate to rejuvenate the industry sector growth,” he added.
The growth of IIP was recorded at (-) 2.1% for the month of November 2013. The cumulative growth of IIP for the period April-Nov 2013-14 stands at (-) 0.2%.
“We therefore expect, a cut in repo rate in the coming third quarter review of monetary policy which is due on 28th January 2014,” he said.
The WPI inflation for the month of December 2013 declined to 6.16% from 7.52% in November 2013. The decline in WPI inflation is attributed mainly to steep reduction in inflation in vegetable as well as onion prices.
“We believe that in the coming times, the government must encourage investments in infrastructure sector especially the agriculture infrastructure in terms of supply side infrastructure that is farm gate to consumer doorstep supply chain management, which could effectively tackle the challenge of inflation,” he added.