Pranab Mukherjee concerned over inflationary pressure on food items

New Delhi, Sep 14 (ANI): Expressing concern over inflationary pressure on food prices, Finance Minister Pranab Mukherjee on Tuesday said that the Reserve Bank of India (RBI) and the Finance Ministry will take appropriate action as and when required.

Talking to reporters here after releasing the Wholesale Price Index (WPI) for August, Mukherjee said:"Inflationary pressure is still there because food prices have gone up because of the erratic monsoon and certain other things."

"The RBI is constantly watching the situation. We are in touch with the RBI. The RBI and the Ministry of Finance will take appropriate measure at the appropriate time," he added.

"I do hope that annual inflation would be much lower and it will be much below in the new series at 8.5 per cent in the annualised rate... I think it be well below in the annualised rate," he said.

As per the new series of inflation based on 2004-05 prices released by the government today, the Wholesale Price Index (WPI) for the month of August stood at 8.51 percent.

The WPI index stood at 9.5 percent in the month of August as per the old series.

Overall inflation in August witnessed a fall of 1.27 percentage points from 9.78 per cent in the month of July, as per the new series, which considers 2004-05 as the base year.

"It (the new index) will help in informing both the government and people how the prices are moving. This will give a robust picture and reflect actual price movement,"

Union Commerce and Industry Minister Anand Sharma today said food inflation is still a cause of concern.

The Wholesale Price Index or WPI is the price of a representative basket of wholesale goods. Some countries use the changes in this index to measure inflation in their economies, in particular India - The Indian WPI figure is released weekly on every thursday and influences stock and fixed price markets.

The Wholesale Price Index focuses on the price of goods traded between corporations, rather than goods bought by consumers, which is measured by the Consumer Price Index. (ANI)