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Thursday, April 30, 2009

Inflation at 0.57%

Higher for second consecutive week

The official Wholesale Price Index for All Commodities for the week ended 18 April 2009 rose to 230.2 from 228.8 for the previous week. The annual rate of inflation, calculated on point-to-point basis, stood at 0.57% for the week ended 18 April 2009 as compared to 0.26% for the previous week and 8.23 % during the corresponding week of the previous year.

The manufactured product group rose by 0.3 % to 201.6 from 200.9 for the previous week. In this group the index for food products group rose by 1.9 % to 226.0 from 221.8 for the previous week due to higher prices of rice bran oil (11%), khandsari and cotton seed oil (8% each), imported edible oil (6%), gur (5%), sugar and oil cakes (3% each), groundnut oil (2%) and rape & mustard oil (1%). However, the prices of unrefined oil (15%) and gingelly oil (1%) declined. The index for basic metals alloys and metal products group rose by 0.1 % to 255.4 from 255.2 for the previous week due to higher prices of zinc and lead ingots (7% each), zinc ingots (4%) and pipes & tubes (2%). However the index of textile group declined by 0.4 % to 140.4 from 141.0 for the previous week due to lower prices of synthetic yarn (2%) and cotton yarn-hanks and cotton yarn-cones (1% each). However, the prices of hessian and sacking bags (1%) moved up.

The primary articles rose by 1.7 % to 253.2 from 248.9 for the previous week. The index for food articles group rose by 0.6 % to 248.3 from 246.8 for the previous week due to higher prices of tea (7%), urad (5%), condiments & spices (4%), gram and moong (2% each) and fruits and vegetables, bajra, maize, arhar and jowar (1% each). However, the prices of masur (3%) declined. The index for non-food articles also rose by 0.7 % to 232.2 from 230.5 for the previous week due to higher prices of mesta (11%), raw rubber (5%), gingelly seed, rape & mustard seed and groundnut seed (3% each), linseed (2%) and castor seed (1%).

The index for fuel power light and lubricants group rose by 0.1 % to 323.0 from 322.6 for the previous week due to higher prices of aviation turbine fuel (8%) and furnace oil (2%).

The wholesale price index rose for the second consecutive week due to higher prices of primary articles and manufactured products. The increase in food and non-food article index craft an anxiety for the end user, who is facing the real price pressure. In addition to this higher food prices has added stress on consumer price index (CPI) due to its higher weight in CPI. However RBI has projected lower CPI and inflation for the current financial year.

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