Inflation declined for the second time in a row and stood at 12.34 per cent for the week ended 23 August as compared to 12.40 per cent in the previous week. The annual rate of inflation was recorded at 3.94 per cent during the corresponding week a year ago. The Wholesale Price Index based Inflation declined mainly due to decrease in the price of the primary articles. The prices of the fish, fruits, vegetables, jowar, mustard oil and urad also fell. The prices of castor seed and raw rubber (1 per cent each) also declined. However the prices of tea (3 per cent) and eggs, condiments and spices (1 per cent each) moved up. Also prices of raw silk (14 per cent), raw cotton (3 per cent) and copra (1 per cent) increased.
The fuel, power, light and lubricants group index remained unchanged at its previous week’s level. The Manufactured Products group index surged by 0.2 per cent as the index for the food products group rose by 0.2 per cent due to higher prices of imported edible oil (2 per cent) and oilcakes (1 per cent). However, the prices of rice bran oil (2 per cent) and cottonseed oil and rape and mustard oil (1 per cent each) declined.
The index for the Base Metals, Alloys and Metal Products group rose by 0.4 per cent due to higher prices of cast iron spun pipes (15 per cent), pipes and tubes (6 per cent), lead ingots (3 per cent) and zinc ingots (2 per cent). However, the prices of zinc (2 per cent) declined. The index for the Transport, Equipment and Parts group rose by 0.2 per cent due to higher prices of bicycles (3 per cent).
The Bank of Baroda chief economist, Ms Rupa Rege Nitsure, said that the decline in the inflation has lot to do with easing of international process of crude oil, which has decreased those components of fuel that is determined by the market forces. She said that it is difficult to predict if the inflation has stabilized from two weeks data and one will have to wait and watch.