Mumbai:
The annual rate of inflation based on the wholesale price
index shot up to a four-month high of 5.26 per cent for
the week ended October 14, mainly due to an increase in
prices of food and manufactured items.
Coming
ahead of the Reserve Bank''s busy season credit policy
review on October 31, the upward shift in inflation trend
is likely to put pressure on interest rates. The RBI had
raised its two key short-term interest rates by 0.25 per
cent in July, the fifth such increase since October 2005
to contain inflation.
The
rate of inflation at 5.26 per cent, was higher than 5.16
per cent in the previous week and 4.77 per cent in the
corresponding week last year. This was also the highest
rate of inflation in 17 weeks after it touched 5.44 per
cent during the week ended June 17.
The
inflation was fuelled mainly by a rise in prices of vegetables,
condiments and spices, eggs, ragi, maize, some edible
oils, cement, zinc, computer, raw rubber and silk, fodder,
soyabean, bidi, polyster staple fibre, methanol, carbon
black and oxygen.
Prices
of jowar, bajra and barley, oil cakes and hessian and
sacking bags eased while there was no change in the prices
of fuel group during the week.
The
government had, in July, removed restriction on imports
of pulses and wheat while banning export of sugar to ensure
adequate supply for consumption and promised further steps
to contain
price rise, mainly of essential items.
The
government wants to keep inflation below five per cent
and it is likely that the RBI takes more monetary curbs
to ease inflationary trends.
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