New Delhi, Mar 29 : Concerned over the inflation rate spiralling out of control, the Cabinet Committee on Prices will meet on Monday to assess factors responsible for soaring prices.
Finance Secretary D Subbarao told reporters here on the sidelines of a seminar that 6.68 per cent inflation rate for the week ending March 15 was partly due to high global commodity prices.
"Generally, we expect commodity prices will go down when there is recession in the developed countries. If you look at past recession in the US, there is depression in commodity prices. But, this time there is elevation in commodity prices together with recession in the US," Subbarao said.
Metal and food prices spurted inflation to the highest number in over a year, much above the Reserve Bank of India's (RBI) tolerance level of five percent.
On Friday, Finance Minister P Chidambaram had said that the Central Government would take all possible measures to curb inflation even at the cost of slowing down the economic growth.
"The government is determined to take all steps -- fiscal, monetary and supply side -- to moderate inflation and if that means we have to live with slightly lesser growth, so be it," Chidambaram had said in Mumbai.
The highest increase was contributed by the index for basic metals. Alloys and metal products group which rose a significant 4.4 per cent due to higher prices of items like joist and rolls, bright bars, angles, channels and sections.
The government also revised the inflation rate for the week ended January 19, 2008 to 4.45 per cent as compared with 3.03 per cent reported earlier.
According to analysts, the announcement of Sixth Pay Commission recommendations, and provisions for enhanced expenditure on social sectors in the Budget 2008-09 coupled with rising crude oil prices have also raised expectations about high inflation.