Inflation swells marginally by 13bps

In the course of higher prices of food and essential commodities, which might prove costlier for the present Congress-led UPA government, the annual rate of inflation has marginally moved upward, as per the latest released data.

The wholesale price-based index revealed that the inflation, which was earlier trailing near zero last month, now began to rise and this was the fourth consecutive week, when it went up.

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Taking the most recent data, the annual rate of inflation calculated on point-to-point basis eased 13 basis points (bps) from 0.57% on week ended April 18 to 0.70% the week ended April 25, 2009.

Last year, for the correspondent week (on April 26, 2008) it was at 8.27%.

The inflation swelled up on the back of price rise in tea (7%), bajra (3%), arhar (2%), castor seed and soyabean (3% each), gur and rice bran oil (4% each), skimmed milk powder and oil cakes (3% each), sugar and khandsari (2% each), castor seed and soyabean (3% each), and chemical and chemical product goods.

However, the prices of masur (2%) and fruits & vegetables (1%), prices of raw rubber (3%), raw silk (2%) and groundnut seed and raw cotton (1% each) dipped marginally.

The rising inflation is also creating challenges for the Reserve Bank of India (RBI) that was expecting a negative inflation in April-June. Now, the apex bank would have to review its monetary policy to take some measurable steps soon.

The annual rate of inflation for the week ended February 28, 2009 for all commodities based on final index, calculated on point to point basis, stood at 2.47% as compared to 2.43% (provisional) reported earlier vide press note dated March 12.