Inflation falls to 4.02%

Wholesale prices rose 4.02 per cent for the week ended March 4, lower than 4.29 per cent in the previous week, mainly due to cheaper chicken, eggs, fish, fruits and vegetables, atta, butter, textiles and zinc.

Bird flu scare continues to hurt chicken and egg sellers as there are few buyers for poultry items even at dirt cheap prices. However, it did not have any adverse effect on prices of vegetables and other essential food items as they became cheaper, indicating adequate supply.

Despite costlier industrial fuel and firm prices of manufactured items, inflation fell by 0.27 per cent to 4.02 per cent, much lower than 5.46 per cent a year ago.

The government and the Reserve Bank have estimated inflation to be around 5-5.5 per cent this fiscal, but they are likely to rein in price rise at around 5 per cent this fiscal.

Wholesale price index (WPI) declined by 0.1 per cent to 196.8 points as prices fell for gur, soyabean, rape and mustard seed, copra, bran and resins. The index was 189.2 points in the year ago period.

However, moong, arhar, fodder, furnace oil, sooji, maida, rice bran oil, imported edible oil, groundnut oil, newsprint, steel sheets, other iron steel and batteries, became costlier during the period.

During the week, world oil prices steadied to $63.4 a barrel owing to concerns over supply disruption in Nigeria and a heightened sensitivity to Iran's nuclear ambitions.

In india, the government has hiked oil prices twice this fiscal so far, but it is yet to fully pass on the increase in prices to consumers due to inflationary concerns.