Wholesale inflation worsened to 3.1 per cent in January from 2.59 per cent in the previous month, government data showed on Friday.
The Reserve Bank of India (RBI) tracks consumer inflation primarily for formulating its monetary policy.
The primary culprits include vegetable prices (50.19% in January) as well as other key food items such as meat, milk, pulses and cereals.
"The "Quick Estimates of Index of Industrial Production" with base 2011-12 for the month of December 2019 stands at 133.5, which is 0.3 per cent lower as compared to the level in the month of December 2018", the Ministry of Statistics & Programme Implementation said.
Meanwhile, a separate set of data showed that the Index of Industrial Production shrunk 0.3% in December 2019, compared with an increase of 1.82% in November 2019.More news: Coronavirus: 'Way too early' to predict end of outbreak, World Health Organization says
According to government data, the output of 16 of the 23 industry groups in the manufacturing segment - which makes up over 75% of the index - contracted in December 2019.
Mining sector output grew by 5.4 per cent, compared to a contraction of 1 per cent earlier.
The Index of Industrial Production (IIP) recorded a negative growth of 0.3% in December in comparison to the same month the previous year, according to the National Statistical Office (NSO). Electricity generation also dipped 0.1% as against a growth of 4.5% in December 2018.
The inflation in fuel and power grew 3.42 percent in January from a contraction of 1.46 percent in December.
Vegetables (including onion) and pulses still contribute in a big way to the rise in inflation, though the rate of inflation of the former did come come down slightly.More news: ‘Crossfire’ Movie Adaptation Lands at Sony
The core wholesale inflation for January saw a contraction of 1 percent against a contraction of 1.5 percent a month ago.
Retail inflation has breached the RBI's medium-term target of 4 percent for the fourth straight month.
The inflation of 7.59% is almost double that of the Reserve Bank of India's medium-term target of 4% for the fourth straight month. Rahul Gupta, head of research (currency), Emkay Global Financial Services, said, "It is the consecutive second month that the CPI has breached upper band of the RBI's inflation target. if inflation continues to hover above 6 per cent, we don't expect the RBI (Reserve Bank of India) to cut interest rate or change its accommodative policy stance", said.
In light of growing inflation and continuing economic slowdown, RBI's Monetary Policy Committee (MPC) has kept its repo rate unchanged at 5.15 per cent.More news: Snoop Dogg Publicly Apologizes To Gayle King After Talking To His Mother