Inflation rate edges up to 3.42 per centnews
05 October 2007

Mumbai: India''s annual rate of inflation based on the wholesale price index rose to 3.42 per cent during the week ended September 22 from the previous week''s 3.23 per cent, mainly due to rise in prices of manufactured items like salt, imported edible oil and some food products, official data showed.

Although the rate of inflation edged up in late September, after easing for more than a month and hitting its lowest in almost five years at 3.23 per cent during the week ended September 15, it is still below the Reserve Bank''s ceiling.

Prices of food articles group fell 0.1 per cent during the week on account of lower prices of cereals, pulses, fruits and vegetables.

Among other manufactured articles, prices of wires of all kinds, lead ingots, steel, tensile plates and cement moved up.

The wholesale price-based index stood at 5.43 per cent in the corresponding week a year ago.

Inflation rate has been well within the 5 per cent upper floor for the 16th week in a row.

Analysts expect inflation rate to rise in the weeks to come but this would not prompt the Reserve Bank of India (RBI) to act on interest rates at its next review due on October 30, they say.

The government is also yet to raise retail fuel prices this year even though global oil prices have crossed $80 a barrel in recent weeks.

The RBI has raised interest rates five times since mid-2006, most recently in March.

also see : General reports on Economy

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Inflation rate edges up to 3.42 per cent