Inflation Rate Falls Further To 4.87%

Helped by falling prices in primary food articles, the annual rate of inflation continued its decline to stand at 4.87 per cent for the week ended on March 21.

During the week, the annual rate of inflation based on the wholesale price index (WPI) eased by 0.05 percentage points to 4.87 per cent (provisional) from 4.92 per cent (p) the week before and 6.91 per cent in the corresponding week of last year.

This is the second successive week in which inflation, calculated on a point-to-point basis, has remained below the four per cent mark. The current fall is mainly on account of continuing weakness in the prices of primary food articles. In the current week, prices of tea, masur, eggs, bajra, gram, urad, wheat, maize and moong from the group have eased.

The official wholesale price index for all commodities (1981-82=100) for the week stood at 335.8 (p) as against 336.7 (p) for the previous week, recording a fall of 0.3 per cent.

The annual inflation based on the final index for the latest week (January 24) stood at 5.7 per cent compared to 5.8 per cent on the provisional index.

All commodities index based on the final index for the week stood at 338.0 as against 338.5 on provisional index. The annual rate of inflation has been on the decline in the last eight weeks after it touched 5.81 per cent on January 24, a 29-week high.

On a comparative basis, inflation based on the consumer price index for industrial workers (CPI-IW) stood at 9.14 per cent in February. The main reason for the continued fall in WPI-based inflation is the fall in prices of primary food articles. During the week under reference, the index of primary food articles fell by about 0.8 per cent.

Primary food articles, which shot up in November-December due to the excessive south-west monsoon rains and coldwave in the north, have eased substantially in the last two months.

The commodities, which have fluctuated wildly during the week are tea (down 6 per cent), masur and eggs (down 5 per cent each), bajra (down 4 per cent) and raw jute (up 4 per cent).

, soyabean (down 4 per cent), steatite (up 7 per cent), rice bran oil (up 7 per cent), gur (down 4 per cent), hessian & sacking bags (up 6 per cent), suphuric acid (down 8 per cent) and caustic soda (down 6 per cent).

Among the major groups in WPI, the index for primary articles and manufactured products declined by 0.5 per cent and 0.2 per cent respectively, while fuel, power, light & lubricants remained static for the 17th consecutive week.