By Siddharthan Meganathan: Subscribe to Siddharthan's RSS feed
October 15, 2010 8:36 AM EDT
Based on monthly wholesale price index (WPI), the annual rate of inflation stood at 8.62 percent for the month of September 2010 as compared to 8.51 percent previous month, according to a government data released on Friday.
The official WPI for 'all commodities' for the month of September 2010 rose by 0.6 percent to 141.1 from 140.3 for the previous month. The build up inflation in the financial year so far was 3.90 percent compared to a build up of 5.44 percent in the corresponding period of the previous year.
The Reserve Bank of India raised interest rates fifth time this year the repo rate by 25 basis points to 6.0 percent and reverse repo rate by 50 basis points to 5.0 percent on September 16, 2010.
RBI said this rate hike to contain inflation and anchor inflationary expectations without disrupting growth. It would reduce the volatility in overnight call money rates and would help to continue the process of normalisation of the monetary policy instruments.
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The index for primary articles rose by 1.5 percent to 179.7 from the previous month.
The index for food articles group rose by 1.6 percent to 179.0 due to higher prices of fish-inland (18%), fruits & vegetables and condiments & spices (3% each), pork (2%) and barley, jowar and milk (1% each). However, the prices of arhar (6%), moong (5%), masur (4%), bajra (2%) and maize, gram, rice and egg (1% each) declined.
The index for 'non-food articles' group rose by 2.0 percent to 157.2 due to higher prices of raw silk (15%), rose (14%), raw cotton (11%), copra (5%), castor seed (3%), coir fiber, gaur seed, cotton seed and jasmine (2% each) and linseed, fodder and groundnut seed (1% each). However, the prices of marigold (15%), raw rubber (5%), rape & mustard seed and gingelly seed (4% each), raw jute (3%), sunflower (2%) and soyabean (1%) declined.
The index for minerals group rose marginally to 248.6 from 248.5 for the previous month due to higher prices of barytes (1%). However, the prices of steatite (9%) declined.
The index for fuel and power group declined by 0.3 percent to 147.6 due to lower prices of aviation turbine fuel (4%), bitumen (3%) and naphtha (1%). However, the price of light diesel oil (2%) moved up.
The index for manufactured products rose by 0.3 percent to 127.6 from 127.2 for the previous month.
India's index of industrial production (IIP) increased 5.6 percent to 309.1, which is the least in 15 months, showed a government data released on October 12, 2010.
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