Mumbai:
The annual rate of inflation based on the wholesale price
index fell for the fourth consecutive week, ending 0.17
percentage points down on May 12 at a five-month low of
5.27 per cent, even as prices of essential food items
rose.
Inflation
rate stood at 5.44 per cent during the previous week and
4.63 per cent during the corresponding week of the previous
year.
While
prices of most items in the major categories of primary
articles and manufactured products were higher, inflation
rate fell due mainly to the base effect of last year.
The
wholesale price index (WPI), on which inflation data is
based, rose 0.1 per cent to 211.7 points during the week
ended May 12 from 211.4 points for the previous week.
Inflation
figures are, however, calculated on the basis of price
movements year-on-year.
When
inflation was hovering above six per cent in the past
few months, it was partly attributed to less than four
per cent inflation last year.
While
prices of most food products in primary articles category
rose, those in manufactured category declined. As such,
while prices of eggs, fruits, vegetables, milk and pulses
rose, items like processed tea, flour, maida, sooji and
bran turned cheaper.
If
inflation continues to fall, the RBI might desist from
further tightening
of liquidity, analysts feel.
There
was apprehension that RBI might go for another hike in
the mandatory cash reserve requirements of banks to cool
inflation.
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