After witnessing an increasing trend in the previous week, India's annual food inflation rate decelerated to 8.06 per cent for the week ended May 21 on the back of cheaper prices of cereals, fruits and rice. The inflation remained in single digit for the tenth consecutive week.
Annual inflation rate of food article prices, as measured by the wholesale price index, or WPI, (with base year 2004-05) for the week ended May 21 fell to 8.06 per cent from 8.55 in the preceding week.
Percentage of inflation for the corresponding week in the preceding year was 21.15 per cent. The 52-week average inflation for the week ended May 21 was 13.76 per cent, according to data released by the Ministry of Commerce & Industry.
Annual percentage of inflation for "Non-Food Articles" fell to 21.31 per cent from 23.22 in the preceding week. The 52-week average inflation for the week ended May 21 was 23.63 per cent.
Primary articles
Annual rate of inflation for the week ended May 21 was 10.87 per cent, down from last week's level of 11.60 per cent. It was 20.40 per cent for the corresponding week of the preceding year. The 52-week average inflation for the week was 16.34 per cent, the data revealed.
The index for this group, with a weightage of 20.12 per cent, decreased by 0.36 per cent from the previous week's level.
These groups and items showed variations:-
Lower prices of chicken, barley, fish-marine, maize, urad, egg and fruits and vegetables brought down the index for "Food Articles" by 0.21 per cent. However, the prices of bajra, gram, milk, jowar and ragi moved up.
The index for "Non-Food Articles" fell by 1.03 per cent due to the lower prices of logs and timber, raw silk, gingellyseed, gaurseed, raw rubber, mesta, fodder and raw jute, while those of mustardseed, soyabean and castorseed moved up.
Fuel, Power, Light & Lubricants
Annual rate of inflation under this category for the week ended May 21 was 12.54 per cent, up from the previous week's level of 12.11 per cent. The 52-week average inflation for the week was 12.11 per cent, the data said.
Index for this major group carrying a weightage of 14.91 per cent rose by 0.37 per cent, on higher prices of petrol and bitumen, whereas those of aviation turbine fuel, naphtha and light diesel oil declined.
The latest drop in food inflation numbers comes in the wake of a slew of bad news for the economy. India's GDP growth slowed to a five-quarter low of 7.8 per cent during the January-March quarter, while the six core industries registered a meager 5.2 per cent expansion in April.
Experts had blamed inflation and the resultant rate hikes by the Reserve Bank of India (RBI), which resulted in slowing down of investment, for the poor economic growth numbers.
Expressing satisfaction over the performance of the economy during 2010-11, Finance Minister Pranab Mukherjee warned that high inflation could moderate the pace of growth in the current fiscal.
Arrival of the monsoon on time may have spurred hopes of bumper crops, but economists said it was too early to take a view on the impact of the rains on prices. Much would depend on the spread and distribution of the rains in the months ahead. The country's weather department has predicted normal monsoon rains for the June-September period.
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