Costlier food items push inflation to 0.61 per cent

New Delhi, May 21 (PTI) Driven by the rising prices of
essential food items like cereals, tea, spices and fruit and
vegetables, India's inflation inched up to 0.61 per cent for
the week ended May 9.

Besides, the manufactured goods like sugar, gur, imported
edible oil, steel ingots and synthetic yarn too became dearer
during the week which witnessed inflation move by 0.13 per
cent from 0.48 per cent in the previous week.

The rate of price rise a year ago, however, was as high
as 8.57 per cent.

This is the 10th week in a row when inflation stood below
the one per cent mark indicating softer instance towards
interest rate.

Many banks have already lowered their interest rates in
response to softer monetary stance. Going forward rates could
further come down if inflation remains below two per cent.

"There is room for for cutting rates if inflation
remains low during the year," said PNB Chairman and Managing
Director K C Chakrabarty.

According to economic think-tank Centre for Monitoring
Indian Economy (CMIE), the average inflation during 2009-10 is
projected to remain negligible at just 0.1 per cent as against
8.3 per cent in 2008-09.

Prices of fuel products and manufactured goods are
expected to see a fall while inflation in primary articles
will remain firm during the current fiscal, economic
think-tank Centre for Monitoring Indian Economy (CMIE) said.

Year-on-year, prices of cereals went up more than 12 per
cent, pulses 14.8 per cent, and fruit and vegetables 9 per
cent. At the same time, the prices of milk have gone up nearly
6.4 per cent over last year, while spices were more expensive
by about 7.1 per cent.

Among manufactured food products, processed fish turned
dearer by more than 42.7 per cent over the last year and
sugar, khandsari and gur went up about 28.4 per cent.

During the week, tea was costlier by 11 per cent, ragi 4
per cent, bajra 3 per cent, spices 2 per cent. At the same
time, rice, wheat, masur, arhar and fruit and vegetables were
each expensive by one per cent each.

Among manufactured products rice bran oil was expensive
by 4 per cent, oil cakes by 2 per cent and gur, imported
edible oil, and gingelly oil by 1 per cent each.

However, the prices of sooji, coconut oil and maida
declined by two per cent each while salt and atta got cheaper
by one percentage point.

At the same time, steel ingots became expensive by 7 per
cent, synthetic yarn by 4 per cent, lead ingots 3 per cent
and zinc ingots 2 per cent. However, newsprint prices declined
by 2 per cent.

Inflation for the week ended March 14 was revised upwards
to 0.71 per cent from 0.27 per cent as estimated
provisionally. PTI