Food price inflation turns negative, declines 3.36 per cent

Bringing cheer to harassed householders trying to stretch their kitchen budgets, food price inflation in India turned negative for the first time in several years, hitting (-) 3.36 during the week ended 24 December 2011 from the previous week's level of 0.42 per cent, official data released today showed.

The first decline in the annual rate of food price inflation in almost six years (with the new base year 2004-05), this may help the Reserve Bank of India go for a downward revision of its policy rates.

The decline in the wholesale price-based inflation rate was aided by lower prices of vegetables following an increase in supplies of seasonal vegetables.

Food price inflation stood at 20.84 per cent during the comparable period of the previous year. Build-up of inflation so far during the financial year was 6.09 per cent against 19.59 per cent in the comparable period of the previous year.

The index for the 'food articles' group declined 0.2 per cent to 190.0 (provisional) during the week ended 24 December 2011 from 190.3 (provisional) during the previous week. During the week prices of jowar, fruits and vegetables, gram and moong declined by 1 per cent each. However, the prices of poultry chicken rode 3 per cent while egg, ragi and maize were dearer by 2 per cent each.

Inflation rate for the non-food articles group stood higher at 0.85 per cent during the week ended 24 December 2011 against 0.28 per cent during the previous week. It was 25.94 per cent during the comparable week of the previous year.