Bucking trend, inflation comes down to 12.4 percent


New Delhi : After showing an aggressive upswing trend for weeks, India’s annual rate of inflation moderated to 12.4 percent for the week ended Aug 16, as compared to 12.63 percent the week before.

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Soon after, a relieved finance ministry headed by P. Chidambram said in a statement: “There are some early signs of moderation of inflation.”

The official wholesale price index (WPI) released by the ministry of commerce and industry showed a decline in the index for non-food articles, mineral, fuel, power, light and lubricants, and non-metallic mineral products.

There was a marginal increase in the index for food articles to 238.8 from 238.7 due to higher prices of moong (up three percent), condiments and spices (up two percent) and tea (up one percent).

The final index for the week ended June 21 stood at 237.7, as compared to 237.1 (provisional).

The annual rate of inflation based on the final index, calculated on point-to-point basis, stood at 11.91 percent, as compared to 11.63 percent (provisional).

Thursday’s official data showed manufactured products index rising 0.1 percent, with the textile registering a rise of 0.3 percent, followed by food products at 0.2 percent.

The index for machinery and machine tools rose 0.1 percent.

“Out of a total of 98 primary articles, 20 articles (like maize, potato, tomato, mutton, iron ore, raw silk and cotton) have shown a decline in prices in the current week,” the finance ministry said in a statement.

“Prices of 30 essential commodities (like pulses, edible oil, cereals, sugar), after remaining range-bound between 5.7 percent to 6.7 percent for 19 weeks in the current financial year, increased from 6.74 percent as on August 9, 2008 to 7.24 percent in the current week,” it said.

“The increase in the rate of inflation of essential commodities comprising cereals, pulses, edible oil, sugar and other products was due to an increase in prices sugar, pulses and dry chillies,” the ministry added.