Encouraged by moderation in food inflation to 7.58 per cent for the week ended July 9, the Finance Minister, Mr Pranab Mukherjee, has expressed hope that the price situation would improve in the days ahead.

“If this declining trend continues, I do hope it will have a moderating influence on the price front,” he told reporters here today.

His comments came after food inflation fell to a three-week low of 7.58 per cent for the week ended July 9 on the back of cheaper pulses and a high base last year.

Food inflation, as measured by the Wholesale Price Index (WPI) stood at 8.31 per cent in the previous week. It was as high as 19.52 per cent in the corresponding week of July 2010, suggesting a high base.

During the week under review, prices of pulses went down by 7.67 per cent on a year-on-year basis. However, the prices of other food items continued to rise.

Inflation of overall primary articles stood at 11.13 per cent against 11.58 per cent and non-food articles at 15.5 per cent (15.2 per cent).

Mr Pranab Mukherjee said the domestic situation on the price front was improving, though concerns remain over international issues.

“The trend is encouraging so far as the domestic sector is concerned. But we do not have total control over international issues, international commodity prices, fuel prices, and the influence of the external inflationary pressure could have some adverse impact on our domestic front,” he said.

The Government had yesterday said that inflation will continue to remain high till December on account of “seasonal effects and upward movement in crude oil, manufactured and administered fuel prices...”.

Headline inflation stood at 9.44 per cent in June. It has remained consistently above the 9 per cent mark since December 2010.

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