NEW DELHI: Wholesale price inflation inched up to a six-month high of 4.35% in the week ended February 9, compared to previous week level of 4.11%, on account of rise in prices of food articles, such as fruit & vegetables, pulses, condiments, and some manufactured products like imported edible oil, mustard oil and groundnut. Inflation was at 6.52% during the corresponding week in the year-ago period.
Experts opine that inflation will rise further in weeks to come on account of hike in fuel prices. Last week, the government had raised fuel prices by 4% to reduce the under-recoveries of oil marketing companies. Last year alone, the global crude prices surged by 56%. Crude crossed the $100 per barrel mark on February 20.
“The numbers are in line with expectations. Further, when the fuel price hike shows up in the inflation numbers from the next week, inflation would move up and could touch 5% level,” said Crisil principal economist D K Joshi.
Though inflation continues to be below RBI’s forecast of close to 5% for this fiscal, the apprehension of it again moving up had not subsided. Experts said this will restrain RBI from going in for a rate cut.
“Inflationary pressures are still lurking in the eocnomy as the prices of almost all commodities are expected to move up further due to demand-supply mismatch. Hence, a rate cut by RBI in the near term, seems unlikely,” said Standard Chartered bank economist Sucheta Mehta.
During the week under review, prices of arhar, fruits and vegetables went up by 3% each, while the prices of condiments & spices and fish marine surged by 2% each. Prices of Bajra and barley shot up by 1% each.
In a non food articles group gingelly seed, groundnut seeds were dearer by 9% and 2%. However, the prices of sunflower and raw wool declined by 6% and 3% respectively.
The index of manufactured products, accounting for 64% in the inflation basket, rose by 0.4% in the week. Among manufactured products, prices of gingelly oil, oil cakes and bran went up by 3% each, while rice bran oil, imported edible oil, and khandsari moved up by 2% each.
The index for fuel, power light and lubricant remained unchanged. Inflation figure for the week ended December 15, 2007 has been revised to 3.84% as from the provisional estimate of 3.45%, as wholesale price index finally stood at 216.4 points as against the earlier calculation of 215.6.
Experts opine that inflation will rise further in weeks to come on account of hike in fuel prices. Last week, the government had raised fuel prices by 4% to reduce the under-recoveries of oil marketing companies. Last year alone, the global crude prices surged by 56%. Crude crossed the $100 per barrel mark on February 20.
“The numbers are in line with expectations. Further, when the fuel price hike shows up in the inflation numbers from the next week, inflation would move up and could touch 5% level,” said Crisil principal economist D K Joshi.
Though inflation continues to be below RBI’s forecast of close to 5% for this fiscal, the apprehension of it again moving up had not subsided. Experts said this will restrain RBI from going in for a rate cut.
“Inflationary pressures are still lurking in the eocnomy as the prices of almost all commodities are expected to move up further due to demand-supply mismatch. Hence, a rate cut by RBI in the near term, seems unlikely,” said Standard Chartered bank economist Sucheta Mehta.
During the week under review, prices of arhar, fruits and vegetables went up by 3% each, while the prices of condiments & spices and fish marine surged by 2% each. Prices of Bajra and barley shot up by 1% each.
In a non food articles group gingelly seed, groundnut seeds were dearer by 9% and 2%. However, the prices of sunflower and raw wool declined by 6% and 3% respectively.
The index of manufactured products, accounting for 64% in the inflation basket, rose by 0.4% in the week. Among manufactured products, prices of gingelly oil, oil cakes and bran went up by 3% each, while rice bran oil, imported edible oil, and khandsari moved up by 2% each.
The index for fuel, power light and lubricant remained unchanged. Inflation figure for the week ended December 15, 2007 has been revised to 3.84% as from the provisional estimate of 3.45%, as wholesale price index finally stood at 216.4 points as against the earlier calculation of 215.6.
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