The Hindu Business Line : Inflation rate rises to 5.6% as food items turn costlier

New Delhi, Jan. 22 Reversing eight weeks of consecutive decline, the annual wholesale rate of inflation increased from 5.24 per cent to 5.60 per cent for the week ended January 10.

The increase has come mainly on account of ‘primary articles’, with the year-on-year increase in the wholesale price index (WPI) for this group going up from 10.85 per cent to 11.64 per cent during the period under review.

Significant jump

And within primary articles, it is the ‘food articles’ sub-group that has shown a significant jump from 9.52 per cent to 11.64 per cent.

The spurt is being attributed mainly to the nation-wide truckers’ strike that led to disruption of supplies of essential commodities.

Fruits & vegetables up

This is particularly borne out by ‘fruits & vegetables’, the index of which registered a year-on-year increase of 23 per cent for the week ended January 10, as against 14 per cent for the preceding week.

“The reversal in the declining trend of inflation is temporary and largely due to the transporters’ strike. The coming weeks will see the headline rate resuming its southward movement and there would be no change in the policy stance favouring softening of interest rates”, officials said.

Fuels down

In fact, the annual inflation rate for the ‘manufacturing’ group has gone up only marginally from 5.58 per cent to 5.90 per cent for the latest recorded week, while the same in the case of ‘fuel, power, light & lubricants’ remained unchanged at minus 1.32 per cent.

‘Manufacturing’ has a 63.75 per cent weight in the overall WPI, while the ‘primary articles’ and ‘fuel, power, light & lubricants’ group account for the balance 22.02 per cent and 14.23 per cent, respectively.

Hitting peak

The headline WPI-based inflation has been coming down every week since November 8, when it ruled at 8.71 per cent, till the 5.24 per cent level of January 3. The inflation rate hit a peak of 12.91 per cent for the week ended August 2.

Since then, not only has the inflation rate eased considerably on a year-on-year basis, but the WPI (base year: 1993-94=100) has even fallen in absolute terms from 241.4 (peaking at 241.7 for the weeks ended September 6 and 13) to 230.

Related Stories:
Inflation rate drops on cheaper food
Inflation rate dips on cheaper primary items

More Stories on : Economy | Commodities

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page