Reversing the fortnight-long upward trend, food inflation eased to 8.53 per cent during the week ended April 23 from 8.76 per cent in the previous week even as prices of all edible items, barring pulses, ruled at higher levels on a year-on-year basis.
The WPI (Wholesale Price Index) data on primary articles released here on Thursday reveals that the downward movement in food inflation may largely be owing to the effect of a high base as it was pegged at 20.91 per cent during the like week last year.
Economic analysts point out that the slight moderation, as per the latest data, should not be any cause for cheer, considering that global commodity prices, especially crude oil, remain at high levels and a hike in the domestic prices petrol and diesel is imminent — likely to be announced after the Assembly polls — which is sure to have a cascading effect on food and overall inflation.
In the event, the Reserve Bank of India may be forced to go in for another round of key policy rate hike later during the year.
