Inflation dips to 7.3%

Inflation fell marginally to 7.30 per cent for the week ended November 27, from 7.34 per cent the week ago. The corresponding figure was 5.49 per cent in the year-ago period.

Finance Minister P Chidambaram today told the Lok Sabha that the decline was a result of various monetary and fiscal measures taken by the government, including a cut in the price of petroleum products on November 15.

Chidambaram also said the move by the Reserve Bank of India to revise inflation for the current fiscal upwards to 6.5 per cent against the original 5 per cent in its mid-term review, would not have any major impact on economic growth.

The finance minister said measures like hiking the cash reserve ratio, introducing the market stablisation scheme and reverse repo operations were responsible for wiping out liquidity worth nearly Rs 13,000 crore.

While there was a 12 per cent fall in the prices of vegetables, manufactured products became costlier by 0.1 per cent. Fuel prices for the week remained unchanged.

The government revised the inflation, measured by the Wholesale Price Index, for the week ended October 2, to 7.15 per cent compared to the provisional level of 7.20 per cent.

The index of the mass consumption primary articles' group was down substantially by over 1 per cent to 189.8 points due to cheaper food and non-food items and it was 182.1 points in the year-ago period.

Food articles' group index fell by 1.4 per cent to 190.3 points due to lower prices of vegetables, ragi, fish-inland and rice.

However, prices rose for jowar and fish-marine and condiments and spices, maize, bajra and moong.

The index for non-food articles' group was down by 1.3 per cent to 182.2 points due to cheaper groundnut seed, raw rubber, linseed, castor seed, safflower and cotton seed.