Food inflation eases to nearly four-year low of 4.35%

Food inflation fell to a nearlyfour-year low of 4.35 per cent during the week ended December 3, reflecting adecline in prices of essential items like vegetables, onions, potatoes andwheat.

This is the lowest rate of food inflation since the weekended February 23, 2008, when it stood at 4.28 per cent.

 

Experts see RBI moving to dovish stance and pausing hikes

Food inflation, as measured by the Wholesale Price Index (WPI), stood at 6.6 per cent in the previous week. It was recorded at 10.78 percent in the corresponding period last year.

Experts feel the moderation in the rate of price rise offood items below the psychological 5 per cent-mark will bring relief to thegovernment, which has been battling high inflation for almost two years now.

According to data released by the government on Thursday, onionsbecame cheaper by 46.03 per cent year-on-year during the week under review,while potato prices were down by 33.28 per cent. Prices of wheat also fell by4.43 per cent.

Overall, vegetables became cheaper by 12.28 per cent.

However, other food products grew more expensive on anannual basis, led by protein-based items.

Pulses became 11.76 per cent costlier during the week underreview, while milk grew dearer by 11.08 per cent and eggs, meat and fish by9.26 per cent.

Fruits also became 9.37 per cent more expensive on an annualbasis, while cereal prices were up by 1.85 per cent.

Inflation in the overall primary articles category stood at5.48 per cent during the week ended December 3, as against 6.92 per cent in theprevious week. Primary articles have over 20 per cent weight in the wholesaleprice index.