After witnessing a decline for two consecutive weeks, food inflation rose marginally to 15.57 per cent for the week ended January 15, justifying RBI fears of inflationary pressures and its tight monetary stance.
Food inflation was up by 0.05 percentage points from 15.52 per cent in the previous week. It rose despite a high base of over 20 per cent a year ago.
Economists believe that RBI may hike policy rates further to curb inflationary pressures. “We believe some more rate hike is on the cards and the inflation rate is not showing signs of abatement,” said Crisil Chief Economist D K Joshi.
In its recent policy review, RBI had raised the repo and reverse repo (short-term lending and borrowing rates) by 0.25 percentage points to tame inflation.
Even as prices of vegetables as a category showed a decline of 0.19 per cent during the week, onions turned expensive by over four per cent, despite government fiscal measures and the export ban. Fruits were also costlier by over two per cent, but the remaining items moved in a narrow range.
In non-food category, minerals rose by two per cent. Inflation of primary items (unprocessed category), which includes food items, was up to 17.26 per cent from 17.03 per cent.
Fuel and power inflation remained flat at 10.87 per cent.