Food inflation decreased to 17.81 percent towards the end of February compared to 17.87 percent in the previous week. Fuel inflation increased due to the recent price hike in excise and customs duty announced in the Union Budget. This has led to an increase in prices by 6 percent on weekly basis. Government is confident that the prices will continue to decline further as the rates have been falling for sometime.
Prices of essential food items are still expensive though the price rise has been declining. Vegetables prices shot up by 15.61 percent. Potato prices increased by 22.46 percent and onion prices rose by about 2.98 percent. Pulses price hike has been steep this year with an increase of 33.38 percent. Though the price reduced from 35 percent in the previous week it’s still not a significant decrease.
In the wholesale market, India’s annual wholesale price inflation increased to 8.56 percent in January compared to 7.31 percent in December 2009. M. Govinda Rao, a member of the Prime Minister’s Economic Advisory Council, said “that India’s wholesale price inflation is unlikely to touch double digits by end-March”.
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