Food inflation softens marginally to 16.81%
Financial Express, January 21, 2010, Page 2
fe Bureau
New DelhiOn a day when the government announced measures to shield poor families from the rise in food prices, the country’s food inflation marginally fell to 16.81% during the week ended January 9.
Food inflation stood at 17.28% a week ago. Despite the decline in food inflation, the rate is still higher, compared with last year’s level of 11.59% during the same period.
Cereal prices rose 14.18%, with wheat rising 15% and rice 12.64%. As reported by FE earlier, although potato prices have softened during the last few weeks, current prices rose by close to 50% y-o-y, while pulses turned dearer by 47.90% owing to higher imports cost. Milk prices rose by 13.95% over last year and are expected to surge further on lower availability, indicated by agriculture minister Sharad Pawar on Wednesday.
Pawar’s comment that states need to take a decision on the demand for hiking milk prices triggered a sharp reaction from political parties protesting against the rising prices of food products. The Cabinet Committee on Prices also announced that an ‘ad-hoc’ allocation of 10 kg per family, per month, over and above the existing allocation of foodgrain, mainly wheat and rice, would be made during January-February, 2010 and is slated to cover all poor families.
According to official data, the rise in fruit prices was moderate at 3.73%. Onion prices rose by over 15%, while vegetable prices were up 7.95%. This is mainly because of drought-like conditions prevailing in most of the onion and vegetable-growing regions of the country. Meanwhile, Sharad Pawar has said Prime Minister Manmohan Singh’s meeting with various state chief ministers on price rise, scheduled for January 27, has now been postponed and is likely to be slated for February 6.
The meeting is intended to devise a combined strategy to deal with rising food prices. Economists have said rising food prices will force RBI to tighten money supply, but will not lead to a rise in lending rates, owing to excess liquidity in the system.
Financial Express, January 21, 2010, Page 2
fe Bureau
New DelhiOn a day when the government announced measures to shield poor families from the rise in food prices, the country’s food inflation marginally fell to 16.81% during the week ended January 9.
Food inflation stood at 17.28% a week ago. Despite the decline in food inflation, the rate is still higher, compared with last year’s level of 11.59% during the same period.
Cereal prices rose 14.18%, with wheat rising 15% and rice 12.64%. As reported by FE earlier, although potato prices have softened during the last few weeks, current prices rose by close to 50% y-o-y, while pulses turned dearer by 47.90% owing to higher imports cost. Milk prices rose by 13.95% over last year and are expected to surge further on lower availability, indicated by agriculture minister Sharad Pawar on Wednesday.
Pawar’s comment that states need to take a decision on the demand for hiking milk prices triggered a sharp reaction from political parties protesting against the rising prices of food products. The Cabinet Committee on Prices also announced that an ‘ad-hoc’ allocation of 10 kg per family, per month, over and above the existing allocation of foodgrain, mainly wheat and rice, would be made during January-February, 2010 and is slated to cover all poor families.
According to official data, the rise in fruit prices was moderate at 3.73%. Onion prices rose by over 15%, while vegetable prices were up 7.95%. This is mainly because of drought-like conditions prevailing in most of the onion and vegetable-growing regions of the country. Meanwhile, Sharad Pawar has said Prime Minister Manmohan Singh’s meeting with various state chief ministers on price rise, scheduled for January 27, has now been postponed and is likely to be slated for February 6.
The meeting is intended to devise a combined strategy to deal with rising food prices. Economists have said rising food prices will force RBI to tighten money supply, but will not lead to a rise in lending rates, owing to excess liquidity in the system.
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