Food inflation slips to 8.84%, but no relief for common man

Food inflation fell to 8.84% in the week ended September 10 from 9.47% in the previous week, but provided no relief to the common man as prices of key commodities continued to rule high.

Prices of most commodities, barring wheat, continued to remain firm on an annual basis, as per Wholesale Price Index (WPI) data released by the government today.

According to experts, the fall in inflation on a weekly basis is on account of statistical reasons, called as "high base effect". Food inflation was above 16% in the corresponding period last year.

As per the data, wheat prices during the week were down 2.72% year-on-year.

However, onions became more expensive by 29% and potatoes 13.78%. Overall, vegetables became 12.13% dearer.

Milk prices, too, were up by 10.38%, while fruits grew dearer by 17.67% and eggs, meat and fish prices rose by 9.28% year-on-year.

Prices of cereals also went up, by 4.13%, during the week under review. Even the prices of pulses, which had exhibited a declining trend during recent months, rose by 1.49% during the week ended September 10.

Overall, inflation in primary articles stood at 12.17% for the week ending September 10, compared to 13.04% in the previous week. Primary articles constitute over 20% of the WPI basket.

Non-food articles, which include fibres, oil seeds and minerals, recorded 17.42% inflation during the week ended September 10, up from 18.49% in the previous week, ended September 3.

Meanwhile, inflation in the fuel and power segment went up to 13.96% during the week ended September 10 from 13.01% in the previous seven-day period.

Experts are of the view that despite the latest fall, pressure on the food price front will continue to keep the government and the Reserve Bank on their toes.

Headline inflation, which factors in manufactured items, fuels and non-food primary items, in addition to food commodities, stood at a 13-month high of 9.78% in August.

The Reserve Bank has already hiked policy rates 12 times since March, 2010, to tame demand and curb inflation.