Wholesale prices rose 14.2% in November from a year earlier, data released by the Commerce Ministry showed today.

That’s faster than the median estimate of an about 12% gain in a Bloomberg survey of 19 economists and is the highest level since December 1991 when the print came in at 14.3%.

Factory-gate inflation has stayed in double digits this financial year that began in April as companies pay more for raw materials amid a rally in global commodity prices and a supply crunch.

The spike “has come as a shock”, said Aditi Nayar, chief economist at ICRA Ltd, the Indian unit of Moody’s Investors Service. Most non-core categories displayed “an inflation rate that was much steeper than expected”, she said.

Digging deeper

Prices of food articles rose 4.9%, fuel and power prices jumped 39.8%, and manufactured products posted an increase of 11.9%.

Data released separately on Monday showed retail inflation inched closer to 5% in November, amid rising costs of food and commodities.

A sustained rise could threaten the Reserve Bank of India’s case for keeping borrowing costs lower for longer to support the economy, given it has a mandate to keep consumer price inflation within its target band of 2%-6%.

The RBI last week left key lending rates unchanged and vowed to keep the accommodative policy stance for as long as needed to support a durable economic recovery.