Inflation holds almost steady at 11.91% - July 18, 2008

The annual inflation rate rose marginally to 11.91 per cent for the week ended July 5, from 11.89 per cent the previous week, mainly due to a softening in prices of food products. On a week-to-week basis, the prices of primary articles were down 0.2 per cent, while that of basic metals and alloys went up by 0.7 per cent. The manufactured products index was up 0.3 per cent and chemicals'' by 0.5 per cent.

The finance ministry said that inflation has stabilised compared to last week. The inflation for the week ended May 10 was revised to 8.57 per from 7.82 per cent. Finance Minister P Chidambaram on Thursday said that monetary measures have started having impact but still pressure exists on prices, referring to his meeting with the RBI Governor Y V Reddy.The rise was close to the levels expected by analysts. IDBI Gilts expected inflation at 12 per cent for week ended July 5. IDBI sees inflation to move higher in the near term and remaining in double digits till March 2009.IDBI Gilt further expects the Reserve Bank of India to again hike rates on indications of higher inflation. The central bank''s quarterly review of credit policy is scheduled for July 29.Economists expect India''s growth to slow this fiscal on higher borrowing costs and tough global financial conditions.