Rising prices of food articles and certain manufactured items pushed up inflation past the one per cent mark to 1.21 per cent for the week ended October 10 from 0.92 per cent in the previous week.
Having remained in the negative territory for 13 straight weeks, mainly owing to high base effect, the WPI (wholesale price index)-based inflation changed course to move in to the positive zone during the first week of September and is expected to creep up to six per cent by the end of the current fiscal.
According to the Prime Minister’s Economic Advisory Council (PMEAC) as also other economic analysts, taming the rise in food prices to contain WPI inflation within the “comfort level” would be the prime challenge for policy makers in the short-term.
However, with economic recovery still in a nascent stage, the general perception is that the Reserve Bank of India (RBI) would not tinker with the key rates in its quarterly review of monetary policy on October 27 as the dominating factor, as of now, would be higher GDP (gross domestic product) growth.
During the week, prices of fish (marine) surged by 14 per cent, moong by five per cent, and rice by three per cent, while pulses (urad and arhar) and wheat were up one percentage point each. Alongside, imported edible oil was dearer by 3 per cent while sunflower, rapeseed and mustard oil prices rose by two percentage points each. On a yearly basis, food items witnessed a steep rise in prices. In particular, raw food articles were 13 per cent costlier following a rise in prices of potatoes by 104 per cent, onions by 35 per cent, milk by 10 per cent, pulses by 23 per cent and rice by 13 per cent. As for manufactured goods, processed food items rose by 16 per cent while sugar was dearer by 45 per cent. However, sooji, coconut oil and gur were cheaper by two percentage points each, while maida and atta prices were lower by one percentage point each.