Wheat, diesel push inflation to 7.81% in Sept

Soaring wheat and diesel prices pushed inflation up to 7.81 per cent in September, the highest so far in this fiscal.

This may restrain the Reserve Bank of India from cutting interest rates during its quarterly monetary policy review slated to take place on October 30. Industry has been demanding a rate cut to bolster the reform measures recently taken by the Government.

Inflation, as measured by the Wholesale Price Index (WPI), stood at 7.55 per cent in August and 10 per cent in September 2011.

Wheat turned costlier by 18.63 per cent in September, up from 12.85 per cent in August and cereals, too, became dearer by 14.18 per cent, from 10.7 per cent, in the month.

Fruits became substantially costlier from 1.14 per cent in August to 6.96 per cent in September.

Following the price rise of petro products, diesel prices shot up by 8.94 per cent during September, from 0.36 per cent in August.

While food inflation eased from 9.14 per cent in August to 7.86 per cent in September, fuel and power inflation surged to 11.88 per cent from 8.32 per cent.

In the manufactured products category, cotton textiles and sugar prices rose. Sugar prices were up from 16.15 per cent in August to 18.36 per cent in September and cotton textiles rose from 4.44 per cent to 6.52 per cent.

Bucking the trend, vegetable prices eased to (-) 6.78 per cent in September on year-on-year basis. Inflation in this segment was 9.98 per cent in August. Onion prices, too, declined during the month to (-) 24.88 per cent.

Inflation for July was revised upwards to 7.52 per cent, from 6.87 per cent, as per provisional estimates.

> heena.k@thehindu.co.in

COMMENT NOW