Inflation increases on costlier food, energy

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Our Bureau

New Delhi, July 8

THE annual wholesale price index-based inflation rose to 4.14 per cent during the week ended June 25, up from the previous week's 4.1 per cent.

The increase in the year-on-year inflation rate was mainly due to a rise in food and energy prices, according to data released by the Ministry of Commerce and Industry on Friday. The inflation rate was at 6.95 per cent during the corresponding week of the previous year.

According to the data, the WPI rose sharply by 0.5 per cent to 193.9 points due to costlier primary articles and fuels, while manufactured items became cheaper. The index was 186.2 points a year ago.

On a disaggregated basis, the Primary Articles' group index rose by 0.5 per cent to 191.4 points due to surge in the prices of food articles. The Fuel, Power, Light and Lubricants' group index shot up by over two per cent to 302.5 points owing to higher prices of diesel (eight per cent), petrol (seven per cent), light speed diesel oil and furnace oil (five per cent each) and bitumen (three per cent). The index of heavy-weighted Manufactured Products' group fell by 0.1 per cent to 170.6 points, even as food items and paper turned costlier.

Among the Primary Articles', the Food Articles' group index rose by 0.7 per cent to 193.9 points due to costlier tea and vegetables (seven per cent each), masur, bajra and barley (two per cent each) and wheat, moong, urad, rice and arhar (one per cent each). However, prices fell in the case of jowar and maize (two per cent each) and fish-marine and condiments and spices (one per cent each).

Among the Manufactured Products', the Food Products' group index rose by 0.5 per cent to 175 points due to higher prices of oil cakes (three per cent), rice bran oil (two per cent) and groundnut oil, khandsari oil and ghee (one per cent each). Prices, however, fell for unrefined oil (three per cent), coconut oil (two per cent) and gur (one per cent).

The index for Paper and Paper Products' group was up 0.1 per cent to 177.9 points due to one per cent hike in the price of newsprint. The index for Beverages Tobacco and Tobacco Products' group declined marginally to 222.2 points due to a one per cent fall in the prices of beer and alcohol. The index for Non-Metallic Mineral Products' fell by 0.1 per cent to 167.5 points on account of a marginal decline in cement price. The Base Metals Alloys and Metal Products' group index was down 0.6 per cent due to cheaper steel sheets, plates and strips (nine per cent), basic pig iron and foundry pig iron (seven per cent each), other iron steel (five per cent) and ms bars and rounds (three per cent).

According to the data, the final inflation and WPI remained unchanged at their respective provisional figures 5.67 per cent and 192.1 points.

(This article was published in the Business Line print edition dated July 9, 2005)
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