Dearer food prices push inflation to 0.26%
The Financial Express, April 24, 2009, Page 2
Press Trust of India, New Delhi
Inflation rose to 0.26% but remained around a three-decade low, even as essential food articles like vegetables and cereals turned costlier, something that is likely to become an issue in the Lok Sabha elections, which are under way. Wholesale price-based inflation rose by 0.08 percentage points during the week ended April 11 from 0.18% in the previous week.
“Some commodities are pressurising inflation. These are primary articles, especially food items like cereals and pulses,” said Crisil principal economist DK Joshi. Even as pulses varieties were cheaper by 0.3% over the previous week, they were expensive by 9.81% year-on-year.
Joshi said now there is enough stock of rice and wheat. But food prices are high as the minimum support prices are up and the production of coarse cereals and pulses has been low. Even on a weekly basis, prices of raw food as a whole rose by 0.5% due to tea turning expensive by 5%, bajara by 3%, vegetables by 2.6%, and mutton and maize by 1% each.
Political parties, including both the ruling Congress and the main opposition BJP, have promised a concessional supply of wheat and rice to the poor through the price distribution system.
On a yearly basis, food prices rose by 7.07%. Specifically, processed tea was costlier by 42.75%; sugar, khandsari and gur by 18.21%; common salt by 13.03%; cereals by 9.81%; and fruit and vegetables by 8.52%.
On Tuesday, the Reserve Bank cut two short-term key rates by 25 basis points each, but economists said there is no link between monetary policy and food prices. Joshi expects the RBI to cut key policy rates further by 25 basis points in the next policy in July.
The Financial Express, April 24, 2009, Page 2
Press Trust of India, New Delhi
Inflation rose to 0.26% but remained around a three-decade low, even as essential food articles like vegetables and cereals turned costlier, something that is likely to become an issue in the Lok Sabha elections, which are under way. Wholesale price-based inflation rose by 0.08 percentage points during the week ended April 11 from 0.18% in the previous week.
“Some commodities are pressurising inflation. These are primary articles, especially food items like cereals and pulses,” said Crisil principal economist DK Joshi. Even as pulses varieties were cheaper by 0.3% over the previous week, they were expensive by 9.81% year-on-year.
Joshi said now there is enough stock of rice and wheat. But food prices are high as the minimum support prices are up and the production of coarse cereals and pulses has been low. Even on a weekly basis, prices of raw food as a whole rose by 0.5% due to tea turning expensive by 5%, bajara by 3%, vegetables by 2.6%, and mutton and maize by 1% each.
Political parties, including both the ruling Congress and the main opposition BJP, have promised a concessional supply of wheat and rice to the poor through the price distribution system.
On a yearly basis, food prices rose by 7.07%. Specifically, processed tea was costlier by 42.75%; sugar, khandsari and gur by 18.21%; common salt by 13.03%; cereals by 9.81%; and fruit and vegetables by 8.52%.
On Tuesday, the Reserve Bank cut two short-term key rates by 25 basis points each, but economists said there is no link between monetary policy and food prices. Joshi expects the RBI to cut key policy rates further by 25 basis points in the next policy in July.
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