The Hindu Business Line : Cheaper food items pull inflation rate down

Index feed
Primary Articles’ group index declined 0.8% to 224.7 points.
Marginal rise in fuel, power, light, lubricants group due to higher prices of aviation turbine fuel.

Our Bureau

New Delhi, Oct. 19 The annual Wholesale Price Index-based inflation rose 3.07 per cent during the week ended October 6, lower than the previous week’s annual rise of 3.26 per cent, mainly due to a dip in prices of food items including fruits and vegetables, besides some manufactured items, Government data showed on Friday.

5-year low

The year-on-year inflation rate during the latest reported week was the lowest since the week ended October 19, 2002, when the index rose 3.01 per cent.

This was the eighteenth week the inflation rate has been below an annual five per cent, which is the RBI’s projection for the current fiscal year ending in March. Inflation has held below four per cent for eight straight weeks now.

During the latest reported week, the WPI for ‘All Commodities’ ended at 214.7 points, from 215.1 points for the previous week. The annual rate of inflation stood at 5.36 per cent during the corresponding week a year ago.

Food group

On a disaggregated basis, the Primary Articles’ group index declined 0.8 per cent to 224.7 points, with the ‘Food Articles’ group index down by 0.9 per cent due to lower prices of fruits and vegetables (4 per cent), bajra and maize (2 per cent each) and moong, fish-marine and eggs (1 per cent each).

However, the prices of urad and gram (1 per cent each) moved up. The Non-Food Articles group index dipped by 0.4 per cent due to lower prices of raw cotton (2 per cent). However, the prices of cotton seed (2 per cent) and raw rubber, linseed and rape and mustard seed (1 per cent each) moved up.

Aviation fuel dearer

The Fuel, Power, Light and Lubricants group rose marginally due to higher prices of aviation turbine fuel (5 per cent).

The Manufactured Products group declined by 0.1 per cent, with the index for Food Products group falling by 0.1 per cent due to lower prices of oil cakes and gur (1 per cent each). However, the prices of rice bran oil and cotton seed oil (2 per cent each) moved up. The index for the Textiles group declined by 0.5 per cent due to lower prices of cotton yarn-cones and other cotton yarn (2 per cent each) and hessian cloth and hessian and sacking bags (1 per cent each).

Paper, rubber

The index for Paper and Paper Products group rose by 0.1 per cent due to marginal rise in the prices of map litho paper. The index for the Rubber and Plastic Products group rose by 0.2 per cent due to higher prices of decorative laminates (7 per cent). The index for Chemicals and Chemical Products group declined by 0.1 per cent due to lower prices of benzene (10 per cent) and purified terephthalic acid (6 per cent). However, the prices of epoxy resins (5 per cent) and PVC resins (3 per cent) moved up.

The index for the Non-Metallic Mineral Products group rose by 0.3 per cent due to higher prices of railway sleepers (10 per cent) and asbestos cement corrugated sheets (2 per cent). The index for Basic Metals Alloys and Metal Products’ group declined by 0.3 per cent due to lower prices of MS bars and rounds and other iron steel (2 per cent each) and steel sheets, plates and strips (1 per cent). However, the prices of zinc ingots (1 per cent) moved up.

Machinery, tools

The index for Machinery and Machine Tools’ group rose by 0.3 per cent due to higher prices of furnaces (46 per cent) and air and gas compressors (1 per cent). However, the prices of electrolytic capacitors (48 per cent) declined. The index for the Transport Equipment and Parts group rose by 0.2 per cent due to higher prices of broad gauge diesel locomotives (9 per cent).

For the week ended August 11, the final WPI stood at 213.7 points, as compared to the provisional estimate of 213.4 points, and annual rate of inflation based on final index, calculated on point to point basis, stood at 4.24 per cent, as compared to 4.10 per cent points reported provisionally.

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