Food inflation crosses 8 pc mark; efforts on to curb it: Govt

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Pranab Mukherjee
New Delhi, Aug 4: Driven by increase in prices of onions, fruits and milk, food inflation for the week ended July 23 again soared to cross the 8 per cent mark after a brief period of moderation even as Finance Minister Pranab Mukherjee said efforts are on to bring it down to 5 per cent.

The spurt in food inflation to 8.04 per cent from a 20- month low of 7.33 per cent for the week ended July 16 is mainly driven by rise in prices of onions, fruits and milk, the Wholesale Price Index (WPI) data released today stated.

The rate of price rise of food items was 16.27 per cent in the corresponding week of July 2010.

Replying to a debate on price rise in Parliament, Mukherjee said efforts were on to bring down the food inflation to a comfortable level of around 5 per cent.

"...it (food inflation) should be around 5 per cent which will be comfortable...6-7 per cent can be tolerated but surely not 8 per cent," he said.

While international commodity prices and mismatch between supply and demand is pushing up inflation, experts said that below normal monsoon could further aggravate the situation.

The data showed onions became dearer by 26.36 per cent year-on-year and fruits were expensive by 15.97 per cent during the week under review.

Milk prices went up by 10.26 per cent, while vegetables were expensive by 10.20 per cent on an annual basis. Besides, cereal prices were up by 5.13 per cent, potatoes by 7.85 per cent, and egg, meat and fish by 6.66 per cent.

The latest numbers also mark a resurgence of food inflation after a two-week long declining trend when the rate of price rise had fallen below the 8 per cent mark. 

PTI

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