Inflation back to 2002 level, nears 3 percent

New Delhi, March 5 (PTI) From the peak of around 13
percent last year, inflation came down to less than one-fourth
at 3.03 percent by the third week of February, fuelling
expectations that the Reserve Bank of India (RBI) might go for
another round of rate cuts.

Wholesale price-based inflation was down at the level
seen over six and a half years ago, as it fell by 0.33
percentage points from 3.36 percent a week ago, justifying the
policy rates cut by the RBI Wednesday.

This is the fifth consecutive week that wholesale
prices-based inflation has fallen with even many food products
turning cheaper, preparing the ground for the Finance
Ministry's expectation that even consumer price inflation will
come down in the next few months.

Food items have a greater weight in consumer price-based
inflation, as depicted by different indices.

"CPI inflation is expected to come down in the next
few months due to declining trend in the WPI food items," the
ministry said in a statement here.

Economists expect inflation to reach zero by this
fiscal end, providing room to the RBI to cut rates further.

While most food products in raw form saw a decline in
prices, manufactured food items like sugar and ghee turned
marginally expensive. Most other manufactured products also
became cheaper, with the exception of metals alloys and
machine tools. PTI DP
PMR
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