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Food inflation eased marginally in the third week of May, with the Government exuding confidence that the trend should continue further in the days ahead. Fuels showed a surge during the week, with the latest data factoring in the nation-wide hike in petrol prices carried out by the oil marketing firms on May 15. Based on the annual Wholesale Price Index, food inflation rose 8.06 per cent in the week ended May 21, lower than the annual rise of 8.55 per cent a week earlier. This was mainly on account of a dip in items such as pulses, wheat and vegetables.
Non-food items
While non-food items, too, showed a downward trend, the inflation rate in the category continued to remain above 20 per cent. The fuel index climbed 12.54 per cent on an annual basis, compared with a rise of 12.11 per cent a week earlier. This was on account of inflation in case of petrol rising over 32 per cent year-on-year, against 22 per cent in the previous week, Government data showed on Thursday. The Centre said it expects inflation to moderate in the coming weeks, but cautioned against uncertainty over oil prices in the international market. “If the declining trend in food items and non-food primary items articles continues, then perhaps it will be possible to have a moderate rate of inflation,” the Finance Minister, Mr Pranab Mukherjee, said. The weekly food inflation has slowed from the double-digit rise for much of 2010, but headline inflation at 8.66 per cent in April remains well above the central bank's comfort level.
Non-food primary articles
According to the data, non-food primary articles recorded inflation of 21.31 per cent during the latest week, as against 23.22 per cent, with fibres surging nearly 56 per cent and minerals by 12 per cent on a year-on-year basis.
“The important figure is the non-food WPI. There is practically a two percentage point decrease from 23.22 per cent to 21.31 per cent (in it). My comment is that there will be a moderation in inflation,” Mr Mukherjee said. During the week, pulses were down by 9 per cent year-on-year, while wheat eased by nearly a per cent. Vegetables were down by 1 per cent on an annual basis, while potatoes became cheaper by over 2 per cent.
However, other food items edged upwards. Fruits were up by 31 per cent and onions by over 12 per cent year-on-year. Protein-based item also continued on their recent upward trend, with milk up by over 7 per cent and eggs, meat and fish surging nearly 6 per cent. Cereals became dearer by 5 per cent, with rice surging by 3 per cent.
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