Apr

5

Inflation Hits 3-Yr High At 7%- Common Man Hit Hard

Filed Under Business | Posted By Jennifer Sullivan |

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India’s wholesale price index moved to 7 percent in three years by March 22, as compared to 6.68 percent in the previous week, the government data confirmed on Friday. The inflation mounted due to higher prices of food, minerals, vegetables and manufactured items, to lead toward a tight monetary policy and slow economic growth.

The prices of fruits and vegetable rose by one percent, masur by two percent, gram by three percent, while urad and moong, meat, eggs and fish got dearer by one percent.

The cost of gingelly, mustard seed and rape rose by five percent and linseed by three percent. However, condiments and spices fell by two percent and fish-marine by four percent.

Among fuel, light, power and lubricants category, prices of furnace oil rose by two percent. The mineral category-index blasted up by 38.2 percent with 46 percent hike in iron ore.

In the manufactured items, vanaspati move up by four percent, sunflower oil by nine percent, mustard oil, while butter, sugar and groundnut oil became costly by one percent each.

Elsewhere, electrode prices soared by 14 percent, steel lumps by 57 percent, forging by 22 percent, cast iron casting with four percent and zince by three percent.

However, ghee, coconut oil prices are calmed by one percent each. At the same time, car chassis got inexpensive by one percent.

The inflation rate for the week ended January 26, has been modified to 4.78 percent from drafted estimate of 4.11 percent as the wholesale price index finally stood at 219 points earlier estimate of 217.6.

The government has already condensed duties on import of different varieties of palm oil and the duty cut on soya oil would be considered by the empowered Group of Ministers (eGoM).

The government has also elevated the minimum export price for non-Basmati rice from USD 650 per tonne to USD 1000.

Manila-based Asian Development Bank expects some measures to sway prices by the month end.
It could also prompt RBI to take financial measures, like raising short-term lending and borrowing rates and compressing money supply in its annual credit policy planned to be announced on April 29.

Signifying that global circumstances are fuelling inflation, managing director of ICICI, K V Kamath said, “I am sure policy makers at the monetary level and in the ministry will collaborate to ease supply side restraint.”

The government is all set to tackle inflation and announced a host of fiscal measures like banning export of non-basmati rice and pulses, scrapping import duty on crude edible oils.



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