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Food inflation eased further in mid-July, even as fuel inflation surged upwards. The slowing down in food inflation was mainly on the back of the continuing decline in pulses, along with the base effect of the previous year.
According to Government data released on Thursday, the annual Wholesale Price Index (WPI)-based food inflation rose 7.33 per cent in the week ended July 16. This was lower that the 7.58 per cent annual rise recorded in the previous week.
Fuel inflation climbed 12.12 per cent during the period, higher than the 11.89 per cent reported in the previous week. Food inflation was at a high — 18.56 per cent during the corresponding period a year ago.
According to the latest data, pulses declined by 8 per cent year-on-year, even as inflation in most other food items went up.
Onions were up by 23 per cent and fruits increased by 14 per cent on an annual basis. Potatoes gained by 11 per cent, while milk surged 10 per cent.
Vegetables were up by 8 per cent year-on-year. The eggs, meat and fish subgroup surged 6.4 per cent from about 8 per cent the week earlier.
Overall, primary articles recorded inflation of 10.49 per cent for the week ended July 16, down from 11.13 per cent in the previous week. Primary articles have a share of over 20 per cent in the WPI.
But inflation of non-food articles increased up to 16.05 per cent from 15.50 per cent in the previous week.
Fibres were up by over 28 per cent and oil seeds close to 14 per cent. Minerals too shot up over 23 per cent year-on-year. The moderation in food inflation is expected to come as a breather for the Reserve Bank, which has adopted a series of measures to battle inflationary pressure.
Headline inflation stood at 9.44 per cent in June.
The RBI has already hiked interest rates 11 times since March 2010, to quell demand and tackle runaway inflation.
The possibility of deficient rains, higher prices offered by the Government to procure farm products and inadequate egg and meat supplies could stoke inflation, the Reserve Bank had said on July 26.
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