Food inflation eased to a six-week low in mid-June on the back of a sharp declining trend in vegetables and pulses, and aided to some extent by the base effect.
Fuel inflation, though, zoomed to a near two-month high, with the recent hikes in diesel and other fuel prices expected to put more upward pressure on overall prices levels in the coming weeks.
The increase in retail prices of diesel, LPG and kerosene announced on June 24 by the Government should start getting reflected in the inflation estimates slated to be announced next week, i.e. the data for the week ended June 25.
Diesel, cooking gas and kerosene make up 6.4 per cent of the total WPI basket and 70 per cent of the fuel component of the WPI. Analysts expect the increase in prices to add about 70 basis points to headline inflation.
According to data issued by the Government on Thursday, food inflation, as measured by the annual Wholesale Price Index (WPI), rose 7.78 per cent during the week ended June 18, up from the 9.13 per cent rise reported during the previous week. It was over 20 per cent during the corresponding week of 2010.
Fuel inflation surged 12.98 per cent in the week to June 18, up from the previous week's annual rise of 12.84 per cent, the data showed. Week-on-week, the index dropped 0.8 per cent to 189.8.
According to the data, inflation in vegetables was down 10 per cent year-on-year during the latest reported week, with potatoes down 2.4 per cent. Pulses also recorded a dip in year-on-year inflation, which came down by 9.50 per cent during the week.
The inflation in the overall primary articles group was recorded at 11.84 per cent for the week ended June 18, down from the 12.62 per cent in the previous week. Primary articles have a share of over 20 per cent in the WPI basket.
However, other food items continued their upward surge during the week.
Fruits were up over 25 per cent, eggs, meat and fish surged by over 10 per cent and onions shot up by over 16 per cent.
Inflation of non-food primary items was recorded at 17.91 per cent during the week ended June 18, down from 18.43 per cent in the previous week. This is even as fibres were up 39.59 per cent on an annual basis, while minerals inched up by 28.51 per cent.