Food inflation up to 8.76%; RBI likely to hike rates further

New Delhi, April 28: Food inflation went up to 8.76 per cent for the week ended April 16, raising fears of another hike in the key policy rates by the Reserve Bank in its annual policy to be announced next week.

Amid concerns of rising inflation, RBI Governor D Subbarao is expected to hold consultations with Finance Ministry officials before firming up proposals for the annual credit policy to be announced on May 3.

"We will talk with RBI Governor before he announces the monetary policy. We will have a discussion," Finance Minister Pranab Mukherjee said.

He, however, maintained that the latest food inflation numbers are in line with recent trends.

"... as far as April 16 is concerned it has been on the same lines. There has been some marginal variations. More or less the trend that was noticed on April 9... the same trend in being maintained," Mukherjee said.

Experts, however, said the rising food prices, coming on top of increasing commodity prices, would force the RBI to go for another round of hike in key policy rates next month.

"The marginal increase in the weekly food inflation rate is statistically insignificant. Of larger relevance is the persistent level of headline inflation," Deloitte, Haskin

PTI