Onion prices shoot up by 114%
With the falling rupee putting pressure on prices and untimely rains having impacted production of vegetables, inflation rose marginally to 4.86 per cent in June, breaking a four-month-long declining trend.
Items like onion, rice and other cereals along with vegetables became costlier putting pressure on prices, a development that could have a bearing on Reserve Bank of India’s first quarter monetary policy review that comes up on July 30. The inflation based on the Wholesale Price Index (WPI) had stood at 4.70 per cent in May. Food inflation rose to 9.74 per cent, driven by rise in prices of onion, cereals and rice in June, against 8.25 per cent in the previous month, as per official data released here.
The price of vegetables went up by 16.47 per cent from 4.85 per cent in May. Onion prices shot up by 114 per cent in June as against 97.40 per cent in May. However, inflation in the manufactured items category declined to 2.75 per cent in June from 3.11 per cent in May. The Consumer Price Index (CPI) based retail inflation for June too had also inched up marginally. As per the WPI data, non-food articles category which includes fibre, oil seeds and minerals, saw a sharp rise in inflation to 7.57 per cent, from 4.88 per cent in May.
In a correction issued by the Industry Ministry, inflation for April has been revised downwards to 4.77 per cent from 4.89 per cent. Inflation in egg, meat and fish was 12.23 per cent during June as compared to 11.21 per cent in May. Price rise in cereals and rice was high at 17.18 and 19.11 per cent. Potatoes, however, saw decline in rate of price rise to (-)14.22 per cent, from (-)3.44 per cent in May. Pulses too declined sharply to 1.59 per cent during June, from 5.95 per cent in May.
For the fuel and power basket, inflation was lower at 7.12 per cent in June as compared to 7.32 per cent in May. The Federation of Indian Chambers of Commerce and Industry (FICCI) president, Naina Lal Kidwai said the industry body will like to reiterate the need to gear up steps to address supply side bottlenecks. ``There is an urgent need to enhance public investment in agriculture as against subsidies and step up agriculture productivity,’’ she stated.