The Hindu Business Line : Inflation rate up on costlier manufactured items

Upward trend
Inflation rate above upper limit of tolerance band
Primary articles prices high despite slight fall
Final inflation figure higher than estimated

New Delhi March 9 After falling for two straight weeks, the annual wholesale price index (WPI)-based inflation registered a 6.10 per cent increase during the week ended February 24, marginally higher than the previous week's annual rise of 6.05 per cent, Government data showed on Friday.

The year-on-year inflation rate was up mainly on account of a renewed increase in manufactured product prices, while the primary articles group prices continued to stay high despite a slight fall.

The WPI (base 1993-94), on which inflation data is based, rose 0.1 percentage points to 208.8 points during the latest reported week, from 208.6 points the previous week.

Annual inflation stood at 4.18 per cent during the corresponding previous period.

The official data on inflation came a day after the Prime Minister, Dr Manmohan Singh, expressed relief in Parliament that inflation rate had declined during the last two weeks.

Dr Singh had said growth could not be allowed to fuel inflation, particularly when it hurts the common man.

The inflation rate remained much above the upper limit of inflation tolerance band (5-5.5 per cent) projected by the Reserve Bank of India for 2006-07.

Inflation had climbed up steadily from 5.16 per cent on December 2, 2006 to a two-year high of 6.73 per cent on February 3.

Eggs dearer

Inflation in case of the primary articles group fell marginally to 11.06 per cent (11.46 per cent).

The prices of food grain, fruits and vegetables, condiments and spices dropped marginally, while those of eggs, meat and fish and oilseeds continued to rise.

The year-on-year rise in the fuel group was down to 1.33 per cent (1.37 per cent).

Inflation in the manufactured products category showed a rising trend again, after some signs of cooling off during the last week.

The prices rose 6.17 per cent (5.88 per cent).

WPI up

The increase came mainly on account of the rise in prices of manufactured food products and chemicals.

The final inflation figure stood higher at 5.89 per cent for the week ended December 30 compared to 5.58 per cent estimated provisionally.

This is based on revision in the WPI to 208.7 points compared 208.1 points estimated earlier.