Inflation dips to 12.40%; Finmin says early signs of moderation

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New Delhi, Aug 28 (UNI) The headline inflation rate moved down to 12.40 per cent for the week ended August 16 as against 12.63 per cent in the previous week, primarily on account of fuel and power group moving Southwards by 1.1 per cent, even though manufactured products moved up by 0.1 per cent.

The Finance Ministry said these were some early signs of moderation.

According to the official data released here today, the annual rate of inflation stood at 3.99 per cent as on August 18 a year ago.

The official Wholesale Price Index for 'All Commodities' for the week ended 16th August 2008 declined by 0.2 percent to 240.2 from 240.7 for the previous week.

This fall in inflation has come after the secular upward march, with the government and the central bank trying to tame the ghost of inflation.

The good news came as the 'Primary Article' group remained unchanged at its previous week level.

Further, out of a total of 98 articles, 21 articles in this group have shown a decline in prices in the current week as compared to August 9, 2008.

These included among others, bajra, jowar, maize, potatoes, tomatoes, mutton, raw silk, cotton, copra, caster, gingelly and groundnut seeds and iron ore.

Another 48 articles have shown no increase in prices.

The 'Fuel, Power and Lubricants' group came to the rescue as the index for this major group declined by 1.1 per cent from the previous with naphtha, furnace oil and light diesel oil witnessing a decline in prices.

Prices of 15 other commodities in this group have remained unchanged, the statement said.

The index for 'Manufactured Products' group rose by 0.1 per cent.

Out of 318 commodities, 287 have shown no increase in prices over the last week.

In the case of 13 commodities, there is a decline in prices.

These commodities include edible oils (rice bran, groundnut, cottonseed, sunflower and imported edible oils), mustard oil cake, mixed fabrics, PVC resins, lead and zinc ingots and cement.

Only 18 products, particularly sugar and khandsari, hessian bags and cloth, mustard and gingelly oil, liquid chlorine, caustic soda, computer and computer based systems, electric motors and some items of steel witnessed an increase in prices.

Prices of 30 essential commodities, after remaining range bound between 5.7 to 6.7 per cent for 19 weeks in the current financial year, increased from 6.74 per cent as on August 9, 2008 to 7.24 per cent in the current week.

The increase in the rate of inflation of essential commodities comprising cereals, pulses, edible oils, sugar and other products was due to an increase in prices of sugar, pulses (moong, masur, urad and gram) and dry chillies.

UNI MP AK RAI2039

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