Dearer milk, eggs push food inflation up to 11.49%

Food inflation continued to give jitters to the government, by rising to 11.49 per cent for the week ended February 12 from 11.05 per cent in the previous week. During the week under consideration broke a two-week declining trend, prompting Prime Minister Manmohan Singh to tell parliamentarians it remained a matter of concern.

Fuel and power inflation remained steady at 12.14 per cent and all eyes are on the impact of developments in West Asia on crude prices, that has already crossed $100 a barrel for the Indian basket.

The Budget, to be tabled in Parliament on Monday, has a major challenge to strike a balance between growth and control inflation, the dilemma faced by the central bank in its monetary policy. More money could be given to the people by cutting taxes and increasing thresholds etc, which will boost growth, but could raise inflation further.

The Prime Minister said in the Lok Sabha that high food inflation was a matter of concern, but exuded confidence that overall inflation would come down to 7 per cent by March-end from 8.23 per cent in January.