Food inflation declines to two-month low of 11.05%

Food inflation fell to 11.05 per cent in the first week of February on arrival of fresh rabi crops in the markets, particularly onions and potatoes, and on the expectations of bumper production of wheat and pulses.

The 2.02 per cent decline in food inflation from 13.07 per cent in the previous week was also caused by high base effect of 22.27 per cent a year ago.

The fall may help overall inflation come down to seven per cent, as expected by the government by the end of this financial year from 8.23 per cent in January. Food inflation has already declined to a two-month low.

In fact, Finance Minister Pranab Mukherjee said that fall in “actual” food items was much sharper and food inflation would fall to single digits soon.