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Increasing food & textile products pushes inflation to negative territory |
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The increasing prices of food items and textile products in the week ended April 11 has pushed inflation more away from its widely expected fall into negative territory.
In terms of wholesale price index (WPI), annual inflation measured came close to 0.26% from 0.18% in the week before.
In its monetary policy review announced earlier this week, the Reserve bank of India (RBI), had suggested that the central bank is no longer concerned about inflation. RBI governor Duvvuri Subbarao said that WPI inflation would go through negative territory for a brief period, though it would move up to touch 4% by the end of the current fiscal.
On Tuesday, while announcing the monetary policy, Mr. Subbarao said, "The wholesale price index may turn negative in the next few months, though that shouldn`t be interpreted as deflation as consumer price gains continue to run at near double-digits."
Currently, inflation is no more a worry but increase in prices of vegetables (2.6%), fruits (0.8%) and cereals (0.3%) continues to be a major worry for policy makers. Prices of vegetables had increased by almost 25% in the week before, and the rise in prices of essential commodities is likely to play spoilsport for the ruling United Progressive Alliance coalition during the Lok Sabha elections.
For the last one-and-a-half months, prices of manufactured items have also been going up. Textile products, chemicals and basic metals also became costlier over the week. The retail inflation is still ruling firm on the back of costlier food items. According to the latest available data, retail inflation measured in terms of consumer price index for industrial workers was 9.63% in February while the same for farm labourers was at 10.79%.
(Posted on : 25/04/2009)
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| Increasing food & textile products pushes inflation to negative territory |
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