Inflation rises to 8.43 pc, case for RBI to hike rates

New Delhi, Jan 14 (PTI) Inflation in India shot up to
8.43 per cent in December, from 7.48 per cent in the previous
month, as prices of certain food and non-food items continued
to show an upward trend.
After moderating somewhat in November, the overall
inflation, measured on the basis of wholesale prices, rose in
December as vegetable, like onion, and other protein-based
items became expensive.
With the inflation showing no signs of moderation, it is
widely expected that RBI will raise the key policy rates
during its quarterly monetary policy review on January 25.
For October, the figure has been revised upwards to 9.12
per cent from the provisional number of 8.58 per cent.
It may be recalled, the food inflation, which accounts
for over 14 per cent in the overall Wholesale Price Index
(WPI) inflation, has remained high through December and stood
at 16.91 per cent.
A worried government on Thursday announced a slew of
measures to contain price rise including de-hoarding
operations and closely monitoring export and import of food
items.
As per the WPI data, prices of primary articles -- food,
non-food articles and minerals -- shot up by 16.46 per cent on
an annual basis, official data released here showed.
However, prices of certain food items declined on an
year-on-year.
While wheat became cheaper by 5.09 per cent, pulses fell
by 10.89 per cent and potatoes went down by 26.57 per cent.
During the month, fuel and power prices went up by 11.19
per cent, while manufactured goods became expensive by 4.46
per cent on an annual basis.
Manufactured items have the highest weight of 64.9 per
cent in the wholesale price index, on the basis of which
inflation is calculated.
Within manufactured products, however, sugar prices eased
by 9.91 per cent and leather and leather goods by 1.23 per
cent on an annual basis. PTI