Higher fuel and milk prices put wholesale food inflation on an upward path again, as it stood at 16.35 per cent for the week ended March 20. Food inflation, as measured by the Wholesale Price Index (WPI), stood at a four-month low of 16.22 per cent during the previous week and at 7.56 per cent in the corresponding period of 2009.
With food inflation on the rise again, analysts feel the overall wholesale inflation for March will be in double digits, prompting the Reserve Bank of India (RBI) to raise monetary policy rates in the fourth-quarter policy review on April 20.
The build-up of food inflation for 2009-10 is 16.63 per cent.
The inflation rates for cereals and pulses, which constitute the essential consumption basket, stood at 10.04 per cent and 31.55 per cent, against 12.13 per cent and 10.74 per cent, respectively, during the corresponding week in 2009. Milk prices surged at the rate of 18.74 per cent on a year-on-year basis, compared with 7.04 per cent last year. Prices of wheat, vegetables , potatoes showed a fall in prices during the week.
Fuel prices rose 12.75 per cent, against -6.11 per cent during the corresponding period last year. The annual inflation rate for petrol was the highest among the fuel category, at 16.82 per cent, while the inflation rate for high-speed diesel was 14.99 per cent.