Mumbai: Cheaper fruits
and vegetables, as well as some manufactured items, pulled India''s wholesale inflation
index to a five-year low of 3.07 per cent for the week ended 6 October, from 3.26
per cent the previous week. It was the lowest annual rise since 19 October 2002,
when the inflation rate stood at 3.01 per cent, official data showed.
analysts said it would not result in a softer monetary policy. The wholesale price
index stood at 5.36 per cent in the corresponding week last year.
Reserve Bank of India (RBI) has said that inflation has been way below its projection
of 5 per cent for this fiscal, and below even its target of 4 to 4.5 per cent
in the medium term. However, inflation risks remain because of high global oil
prices, it said. Global crude oil prices are at around a record high of $88 a
fall in the inflation rate has fuelled expectations that the RBI could reduce
interest rates in its half-yearly monetary review due on 30 October. However,
in the given scenario, there is very little possibility of the RBI lowering benchmark
the week, fruits and vegetable prices dipped by 4 per cent, eggs and fish-marine
fell marginally by 1 per cent, while bajra and maize declined by 2 per cent each.
Among manufactured items, prices of oil cakes and gur (jaggery) declined marginally
by 1 per cent each.
index for primary articles group stood 0.8 per cent lower at 224.7 against 226.4
points the previous week. The index for fuel and power remained unchanged at 322.1
points while the index for manufactured products stood 0.1 per cent lower at 187.2.
articles were cheaper at 223.8 points (-0.9 per cent) and manufactured food products
were lower at 189.1 points (-0.1 per cent). Edible oils were dearer at 171.8 points
(+0.5 per cent); fruits and vegetables turned cheaper at 251.2 points (-3.8 per
cent) and cereals were lower at 211.3 points (-0.1 per cent) while cement prices
were unchanged at 216.2 points.
however, said supply-side pressures remained, pointing to high prices of food
grains, metals and crude oil.
food grain prices are high and crude is touching $90 a barrel.
inflation rate has been below 5.0 per cent - the Reserve Bank''s projection for
the fiscal year ending in March 2008 - for the 18th week now. Inflation has now
held below 4 per cent for eight straight weeks.