The Hindu Business Line : Inflation shoots up to 11%

New Delhi, June 20 Inflation shot into double digits hitting a 13-year high as the fuel price hikes effected earlier this month got factored into the data. .

The annual Wholesale Price Index-based inflation rose 11.05 per cent during the week ending June 7, its highest since the first half of 1995 and significantly higher than the 8.75 per cent annual increase in the previous reported week.

The year-on-year inflation rate flared up mainly on account of the inflation in the fuels group more than doubling in a week’s time, even as the inflation in the case of both the primary articles and manufactured products inched upwards.

Inflation during the latest reported week is higher by 677 basis points against the corresponding week a year ago, when it was recorded at 4.28 per cent.

On a disaggregated basis, the year-on-year inflation in the fuels group jumped to 16.25 per cent from the 7.86 per cent annual rise recorded in the previous week. According to CMIE, this was the highest inflation in the fuels group witnessed ever since March 17, 2001.

The Government had partially passed on the burden of the rising international crude prices to consumers by hiking retail prices of petrol, diesel and LPG with effect from June 5.

Inflation in primary articles climbed up further to 10.78 per cent during the latest reported week, up from 9.74 per cent in the previous week.

Inflation in manufactured products also moved up further to 9.09 per cent, up from 8.77 per cent in the previous week.

Continuing a trend of sharp upward revisions, final inflation for the week ended April 12 was revised up to 7.95 per cent, from the provisional estimate of 7.33 per cent.

The opposition BJP blamed the Government for its “failure” in managing the economy, while the CPI(M) Polit Bureau came out with a statement saying mounting inflation was “a direct result of the steep increase effected by the Government in the prices of petrol, diesel and cooking gas”.

Industry chambers reacted strongly and slammed the Government on the rising inflationary trend.