As industries and businesses slowed down during the nation-wide lockdown, demand for fuel and power hit hard, deflating prices by around 20% per year in May 2020. According to the Ministry of Commerce & Industry, crude petroleum and natural gas prices fell 23.18 per cent in May compared to March 2020. During this time the prices for coal and electricity remained unchanged. In the month of May, the overall wholesale prices also saw a steep fall of 3.21 per cent amid sluggish economic activity and weak demand. Last year, WPI rose by 2.79 percent in the same month.
While wholesale prices for most of the products have deflated, food prices are still on the rise. In May, wholesale food prices rose by 2.31%. However, inflation accelerated from 5.20 per cent in March 2020. Although the price of potatoes rose by 52.25% m-o-m in May, the price of onion rose by 6.26% and the price of pulse rose by 12%.
After 10 weeks, the wholesale price index is finalized and final figures are issued by the government. Due to the limited information available for the month of April 2020, the provisional figures for May 2020 are compared with the final figures for March 2020.
Meanwhile, the government did not release the retail inflation figures for the month of May and stated that the data was collected through personal visits by NSO field staff and telephone calls from designated outlets in selected markets only to the extent that it was feasible. The government, however, released food inflation figures, which shot up last month. The May 2020 inflation rate for the Consumer Food Price Index (CFPI) for agricultural , urban and combined sectors rose by 9.69 per cent, 8.36 per cent and 9.28 per cent respectively, according to MOSPI.
