Food inflation at year's low of 12.85%

Food inflation, as measured by the Wholesale Price Index (WPI), for the week ended October 23 fell to a one-year low of 12.85 per cent, primarily as prices of all major food items came down during the week on the back of increased supplies.

Food inflation was at 13.75 per cent in the previous week ended October 16, and 12.87 per cent during the corresponding period in 2009.

Fuel inflation also declined during the week and stood at 10.67 per cent, down from 11.25 per cent in the previous week.

Even as food items comprising the essential consumption basket like cereals, pulses and rice declined during the week, high calorie and protein-based items like milk, egg, fish rose by 28.85 per cent on an annual basis during the same period.

“The food articles index has registered a decline for the third consecutive week, led by a cooling in prices of vegetables, pulses and cereals. However, the prices of fruits, eggs, meat and poultry continued to rise in week-on-week terms, reflecting to an extent the structural nature of inflation and demand-supply mismatches highlighted by the Reserve Bank of India ,” said Aditi Nayar, economist with ratings agency Icra.