Riding on the back of food inflation, especially protein-based item, the annual rate of inflation, based on monthly wholesale price index, rose to 6.95 per cent in February.
Inflation rate was 6.55 per cent in January and 9.54 per cent in the same period last year.
Reacting to the inflation numbers, Finance Minister, Mr Pranab Mukherjee, said, “Inflationary pressure is there…we will end the year with 6.5 per cent inflation.”
Prices of vegetables rose by 1.52 per cent during February and pulses turned costlier by 7.91 per cent. Prices of vegetables crashed 43.13 per cent in January. Prices of egg, meat and fish prices rose 20 per cent during February, from 18.63 per cent in January. Milk too became expensive by 11.70 per cent.
Price of onion, however, bucked the trend, declining by 48.50 per cent year-on-year in February.
Prices of manufactured items, which weigh 65 per cent in the WPI basket, went up by 5.75 per cent year-on-year in February, as against 6.49 per cent in the previous month.
Among manufactured items, iron grew dearer by 15.82 per cent and edible oil prices rose by 7.57 per cent, on an annual basis. The cost of tobacco products rose by 10.10 per cent and basic metals became costlier by 10.44 per cent.
Non-food primary articles, which include fibres and oilseeds declined 2.56 per cent in February. Inflation in the fuel and power segment was 12.83 per cent on an annual basis as against 14.21 per cent in the previous month.
This inflation data came a day before RBI takes up a mid-quarterly policy review on Thursday. RBI is widely expected to hold the policy rates, given the inflation situation in the economy.