The rate of food inflation showed some signs of moderation, sliding to 17.81 per cent for the week ended February 27, primarily on account of a marginal decline in prices of foodgrain like rice and cereals. However, fuel prices showed significant rise, even as the impact of the increase in duty rates would kick in for the weeks after February 27.
Food inflation stood at 17.87 per cent in the previous week and at 7.54 per cent in the corresponding period in 2009.
Even as experts say food inflation is expected to moderate further in the coming months, the overall point-on-point inflation rate is expected to be near double digits by the end of the current financial year.
Government officials have also repeatedly said food inflation, which had consistently been in double digits, would moderate from April, when the rabi crops hit the markets. However, experts feel even though food inflation will show some decline, due to the low base effect, the rise in prices of fuel would add to inflation in agricultural commodities. The overall inflation may be in double digits, they say.
“Food inflation is expected to moderate, going ahead, but inflation in fuel and manufactured category will firm up. This is also because of the low base last year. It may be around 10 per cent by the end of this financial year,” said Crisil Principal Economist D K Joshi.