Food inflation eased to single digit at 9.55 per cent for the week ended August 27 from 10.05 a week ago but provided hardly any relief to the common man as all items, except wheat and pulses, continued to rule at higher levels.
As per the WPI (Wholesale Price Index) data released here on Thursday, while pulses and wheat saw a decline in prices by 1.56 per cent and 1.04 per cent, respectively, on yearly basis, all other food items turned dearer. Prices of onions surged by 42.03 per cent and potatoes by 13.38 per cent on an annual while vegetables, as a whole, were 22.42 per cent dearer.
Alongside, fruits were 16.57 per cent costlier, as were milk and cereals by 9.12 per cent and 5.45 per cent, respectively.
With little respite from the price spiral, Finance Minister Pranab Mukherjee hoped that food prices would moderate after the festive season while expressing his concern over the rising prices non-food and fuel items. “During the festive season, there will be some fluctuation [in food prices]. But after that, moderating influence will continue,” he said.
Significantly, inflation in non-food articles, including fibres, oilseeds and minerals, was pegged at 19.88 per cent for the week, up from 17.19 per cent in the previous week while the inflation index in the fuel and power segment stood unchanged at 12.55 per cent.
Accounting for a 20 per cent share in the WPI basket, inflation in primary articles was also higher at 13.34 per cent for the week ended August 27, up from 12.93 per cent in the previous week.
Noting that the price trend in non-food and fuel segments was not encouraging as yet, Mr. Mukherjee said: “Though food inflation has come down ... [inflation of] other items have increased substantially, particularly the non-food primary articles, which is not at all encouraging … Fuel prices are still a cause of concern, and oil is hovering around $115 a barrel. I do hope it will be possible for us to have some moderation with the international economy's trend. But it is difficult to predict that right at this juncture.”
A plausible reason for the dip in food inflation, according to experts, could be the moderation in the rate of price rise of some items such as milk and vegetables on a weekly basis even as the overall trend is to move northward. Coupled with the weekly price variation could be the high base effect on an annual basis as food inflation was at a high of 14 per cent during the corresponding week a year ago.