Thursday, March 5, 2009

Statement of Finance Ministry on Inflation

The following is the statement of Department of Economic Affairs, Ministry of Finance on inflation issued here today:

  “Annual (year-on-year) rate of inflation decelerated further to 3.0 per cent for the week ending February 21, 2009 as against 3.4 per cent in the week ending February 14, 2009, showing a fall of 33 basis points. The current rate of inflation is the same as was recorded in the week ending October 19, 2002. WPI for all commodities has declined to 227.6, a level lower than at the beginning of the current financial year.

Year-on-year Inflation by Commodity groups

  Commodity group wise examination shows decline in primary and manufactured products categories. The details are as under: 

 i. In ‘primary articles’, inflation declined to 6.0 per cent in the current week as against 7.3 per cent in the previous week. In ‘primary food articles’, inflation declined to 8.3 per cent as compared to 9.9 per cent last week. In ‘non-food articles’, inflation fell to 1.7 per cent compared to 2.9 per cent in the previous week, while in ‘minerals’, inflation remained stable at (-) 1.2 per cent. 

ii. In ‘fuel and power’, inflation remained stable at (-) 4.0 per cent as in the last week. 

iii. In ‘manufactured products’, inflation rate was 4.5 per cent in the current week which is marginally lower than 4.7 per cent last week. Within the manufactured products group, 

a) Inflation in food products remained stable at 7.5 per cent; 

b) Inflation in non-food manufactured products with 52.2 per cent weight in WPI basket decelerated to 3.8 per cent, showed a decline of 69 basis points as compared to last week.

Year-on-year inflation in the combined food index

  Inflation in the food index (wt = 25.43 per cent) for the week ended February 21, 2009 was lower at 7.7 per cent compared to 8.6 per cent last week, due to decline in the rate of inflation of rice, wheat, pulses, vegetables and edible oils. However, current sugar inflation recorded a higher rate of 23.1 per cent. 

Monthly inflation 

  Monthly WPI inflation for January 2009 recorded 5.2 per cent (provisional) which is lower than the inflation of CPI-IW (10.5 per cent), CPI-AL (11.6 per cent) and CPI-RL (11.4 per cent). CPI inflation is expected to come down in the next few months due to declining trend in the WPI food items.”

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