Inflation static at 7.1%

New Delhi, Oct 29 | Updated: Oct 30 2004, 05:49am hrs
The annual rate of inflation on point-to-point basis has remained static at previous weeks level of 7.1% for week-ended October 16. The rate of inflation a year ago was 5.13%.

Commenting on inflation, finance minister P Chidambaram said in Mumbai that government would continue to closely monitoring the situation and would not allow any irrational price behaviour in commodities and goods.

Inflation stood firm despite the twin tranche of hike in Cash Reserve Ratio to 5%. Though rate of inflation remained static, certain commodities like vegetables and fruits, some edible oils, ghee and processed tea became cheaper.

Inflation rate has been coming down since it touched a high of 8.33% for week ended August 28. However, rising crude prices, which touched a peak of $55 a barrel during the week under review, has continued to be a cause for concern.

The Wholesale Price Index during the week rose by 0.1% to 188.6 points due to rise in prices of fuel by 0.2% and manufactured products by 0.1%. u The index for primary articles, however, declined by 0.3%.

As per the revised figures, the rate of inflation stood at 8.46% for the week ended August 21 as against the provisional figure of 8.17%. The final WPI worked out to be 188.5 points as against the provisional at 188 points.

For the week ended October 16, the index of mass consumption primary articles group fell to 190.5 points due to cheaper food and non-food items.

The food articles group index was down by 0.2% to 189 points. The index of non-food articles group fell sharply by 0.7% to 187.6 points due to lower prices for raw cotton (4%), raw tobacco and raw silk (2% each) and sugarcane (1%).

A 4% hike in the price of furnace oil and 2% in naphtha, both of which are vital ingredients for the industrial sector, pushed up marginally the index of fuel, power, light and lubricants group to 281.7 points even as there was no change in the price of other petroleum goods.