Govt concerned over inflation, will take steps: Pranab

Expressing concern over rising inflation which surged past 9% in May, Finance Minister Pranab Mukherjee today said the government would take appropriate action to contain prices.

"We would keep a close watch on developments, both domestic as well as international, in the coming months and make appropriate adjustments as we go along," he said in a statement.

The inflation, as per the data on the Wholesale Price Index (WPI), went up to 9.06% in May from 8.66% in April following an increase in prices of essential items like fruits, milk, petrol and manufactured goods.

Pointing out that inflation for May at 9.06% was lower than 10.48% recorded a year ago, Mukherjee said, "the picture for the latest month is however mixed."

While food and primary inflation has declined, "core inflation (that is other than food, fuel and power inflation) continues to harden...This poses some concerns which will have to be addressed", he said.

Referring to rising prices of essential kitchen items, he said, "other than fruits, inflation is moderating in all food items".

The rate of price rise in non-food primary articles, he said, is still high at 22.35%, though it has moderated from 27.33% in April.

This decline in inflation of non-food articles, Mukherjee hoped, would help in moderating the inflationary tendency in the economy in the coming months.