Wholesale Price Index rose to 20 month high of 1.6 percent in June

Q.  The Wholesale Price Index rose to a 20 month high of 1.6 percent in June from what figure in May?
- Published on 20 Jul 16

a. 0.6
b. 0.7
c. 0.8
d. 0.9

ANSWER: 0.8
 
Wholesale Price Index rose to 20 month high of 1.6 percent in June from 0.8 percent in May will work well for toll road projects revenues for the fiscal 2017-2018, according to ICRA.
  • The toll rates are expected to increase in the range of 3.0-3.7 percent during FY2018, marking the highest growth after FY2015.
  • Average increase in WPI for 2017 is around 3 percent and a report also indicated that toll fees are revised annually to adjust for inflation as determined by movements in WPI.
  • The report also indicated that toll fees are annually revised to adjust for inflation as determined by WPI movements.
  • Projects for which toll rates are linked fully with WPI, the toll rates are revised downwards whereas for other projects, increase has been 2.7 percent in FY2016 and 1.9 in FY2017.
  • Traffic growth has been robust during FY2016 which is likely to continue during the current fiscal.
  • According to the report, in a low inflation scenario. when there is no commensurate fall in interest rates, profitability of toll road projects is negatively impacted.

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