Inflation dips to record low at 3.02%

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New Delhi, Nov 2 (UNI) Decline in prices of non-food articles and chemical products pulled inflation to a record-low of 3.02 per cent for the week ended October 20.

The wholesale price-based index stood at 3.07 per cent in the previous week, which was a five-year low and 5.61 per cent in the same week last year, an official statement said here today.

The Reserve Bank of India (RBI) has sought to cool inflation further by raising the proportion of funds that lenders must keep in reserve rather than lend out.

Moving to cut the amount of rupees in circulation, RBI on Tuesday raised the cash reserve ratio (CRR) of central banks from 7 per cent to 7.5 per cent.

Inflation has been way below RBI's projection of 5 per cent for this fiscal and even its target of 4-4.5 per cent in the medium term. However, the downward risks to inflation remains bacause of high global crude prices, RBI had said.

The wholesale price index (WPI) for 'All Commodities' for the week ended October 20, 2007 rose by 0.05 per cent to 215.1 (provisional) from 215.0 (provisional) for the previous week.

The index for primary food articles declined marginally to 225 from 225.1 for the previous week.

The index for 'Food Articles' group rose by 0.2 per cent to 225.0 from 224.5 for the previous week due to higher prices of maize (four per cent), arhar (two per cent) and masur, milk, wheat and condiments and spices (one per cent each).

However, the prices of fish-marine and bajra (two per cent each) and urad (one per cent) declined.

The index for 'Non-Food Articles' Group declined by 0.7 per cent to 208.8 from 210.3 for the previous week due to lower prices of soyabean (four per cent), raw tobacco, groundnut seed and raw wool (two per cent each) and raw cotton (one per cent).

However, the prices of castor seed (two per cent) and coir fibre (one per cent) moved up.

The index for Fuel, Power, Light and Lubricants rose by 0.1 per cent to 323.7 from 323.4 for the previous week due to higher prices of naphtha, furnance oil and bitumen (one per cent each).

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