Drop in inflation too little, fight will continue: Pranab

Written by: Pti
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New Delhi, Feb 14 (PTI) Terming the marginal decline ininflation during January as "too little for comfort", FinanceMinister Pranab Mukherjee today said the fight against risingprices would continue.

Commenting on the decline in inflation by 0.20 percentagepoint in January to 8.22 per cent, he said, the "decrease istoo small to be comfortable". The inflation was 8.43 percent in December 2010.

The inflation rate, the Minister hoped, would calmdown to 7 per cent by the end of the current fiscal.

"...even though overall food inflation is a matter ofconcern, we must remember that we have come a long way fromthe peak...we still have some distance to go in controllinginflation," Mukherjee added.

Containing prices would continue to be a challengefor the government, Mukherjee said, adding the 7 per centtarget is still not good enough and that the fight againstinflation would continue.

Mukherjee said the food article inflation inJanuary 2011 stood at 15.65 per cent which is more than the13.55 per cent level in December 2010.

The Finance Minister added that fortunately the inflationrate of manufactured food declined to minus 1.3 per cent.

He, however, said the inflation numbers in the comingmonths would depend on global developments and the way thecommodity prices move in the global markets.

When asked about the impact of likely wheat crop failurein China, he said the government was not aware of thesubstance of the reports although the wheat prices are alreadyfirming up in the global market.

"Already there is a firming up of wheat, food prices inglobal market", he told reporters.

However, in India the wheat prices declined by 4.94 percent in January over the same month last year.

Mukherjee attributed the decline in January inflation tomonthly variations and said the fall was on expected lines.

"Don''t go by the weekly fluctuation or monthlyfluctuations. This was expected. It is nothing unusual," hesaid.

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