New Delhi, Sept 8: Food inflation slipped to 9.55 per cent for the week ended August 27, but the common man continued to reel under price pressure as all items barring pulses and wheat remained expensive. The rate of price rise of food items fell to a single-digit during the week under review from a five-month high of 10.05 per cent in the previous seven-day period.
Finance Minister Pranab Mukherjee expressed hope that food prices will fall further after the festive season, even as he expressed concern over the high prices of non-food and fuel products.
“During the festive season, there will be some fluctuation (in food prices). But after that, moderating influence will continue,” Mukherjee told reporters here.
As per data released by the government today, prices of pulses fell by 1.56 per cent year-on-year, while wheat became cheaper by 1.04 per cent during the week under review. Other food items, however, registered an increase in prices. Onions became dearer by 42.03 per cent on an annual basis, while potato prices were up by 13.38 per cent and fruits grew 16.57 per cent costlier. Overall, vegetables became 22.42 per cent costlier.
Milk and cereals, too, became dearer by 9.12 per cent and 5.45 per cent, respectively, during the review period. Agreeing with Mukherjee, economists said the price pressure on food items is likely to ease. “Certain items like vegetables are expensive due to seasonal factors and supply disruptions on account of the monsoon. We expect them to stabilise,” Crisil chief economist D K Joshi said.
Mukherjee, however, said the price situation in the non-food and fuel segments is still not encouraging.
“Though food inflation has come down... (inflation of) other items have increased substantially, particularly the non-food primary articles, which is not at all encouraging,” the Finance Minister said.
Inflation in non-food articles, which include fibres, oilseeds and minerals, stood at 19.88 per cent during the week under review, up from 17.19 per cent in the previous week. Meanwhile, fuel and power inflation stood at 12.55 per cent in the week ended August 27, the same as in the previous week.
“Fuel prices are still a cause of concern, hovering around USD 115 per barrel. I do hope it will be possible for us to have some moderation with the international economy's trend. But it is difficult to predict that right at this juncture,” Mukherjee said.
Overall, inflation in primary articles was recorded at 13.34 per cent for the week ended August 27, up from 12.93 per cent in the previous week. Primary articles have a share of over 20 per cent in the overall Wholesale Price Index basket. Experts said the fall in food inflation numbers could be attributed to a moderation in the rate of price rise of some of the items on a week-on-week basis, even though they continued to grow.
In the previous week ended August 20, the rate of price rise of items like vegetables and milk was higher on an annual basis in comparison to the week under review.
The decline was also on account of the high inflation figure of over 14 per cent in the corresponding year-ago period, a phenomenon dubbed the ‘high base effect' in economic parlance. PTI
