India’s food inflation rises for second week

December 16th, 2010 - 2:55 pm ICT by IANS  

New Delhi, Dec 9 (IANS) India’s annual food inflation rose for the second consecutive week, to 9.46 percent for the week ended Dec 4, as prices of food items like milk, poultry and fruits continued to rule high, official data release Thursday showed.The food inflation rate, based on the official wholesale price index, had dropped to a four-month low of 8.6 percent for the week ended Nov 20, because of monetary policy tightening by the Reserve Bank of India (RBI).

Incidentally, the RBI in its mid-quarter Thursday kept almost all rates intact, while lowering the statutory liquidity ratio (SLR) by 100 basis points to 24 percent to ease liquidity in the system.

The move indicated that the RBI was expecting inflation in prices of food articles to temper and that the central bank now wanted to make credit available for industrial growth.

The 52-week inflation rate for non-food articles dropped a tad to 21.24 percent for the week ended Dec 4 compared to 23.46 percent in the previous week.

Primary articles index rose to 13.25 percent, while that for fuels increased to 10.67 percent.

The following is the rise and fall in prices of some of the main commodities that form the sub-index for food articles over the past 52 weeks:

Cereals: 0.06 percent

Rice: 1.47 percent

Wheat: (-)4.24 percent

Pulses: (-)11.46 percent

Vegetables: 0.99 percent

Fruits: 19.75 percent

Milk: 17.76 percent

Potatoes: (-)35.78 percent

Onions: 29.93 percent

India’s annual rate of inflation based on wholesale prices fell to 7.48 percent in November compared to 8.58 percent in the previous month though the indices for three major constituent commodity groups saw a rise.

The government is still not comfortable with this level of headline inflation, Deputy Chairman of Planning Commission Montek Singh Ahluwalia said Thursday.

The annual rate of inflation is much more than the year-end projection of 5.5 percent by the RBI.

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