“Both in food inflation and overall Whole Price Index (WPI) inflation, there is a declining trend,” Finance Minister Pranab Mukherjee told reporters here.
His comments came after food inflation slipped to 7.47 per cent for the week ended May 7, continuing on its downward trajectory for the third consecutive week. This is the lowest food inflation figure since separate data on the rate of price rise of food items was first released about 18 months ago.
The fall in food inflation, as measured by the Wholesale Price Index (WPI), from 7.70 per cent in the previous week was mainly due to cheaper pulses, wheat and vegetables.
Mr. Mukherjee said inflation has come down in all three segments - primary articles, food and non-food.
Inflation in overall primary articles during the week under review stood at 10.94 per cent, down from 11.96 per cent in the previous week.
In the non-food primary articles segment, inflation fell to 23.82 per cent from 28.62 per cent during the week ended April 30.
“I do not give much credibility to weekly fluctuations or monthly fluctuations. We shall have to take an overall view,” Mr. Mukherjee said.
The latest numbers are likely to bring cheer to the government, which has termed inflation control as one of the major items on its agenda.
Food inflation remained in double-digits for most of 2010 before showing signs of moderation from March this year.
During the week under review, pulses became cheaper by 8.87 per cent year-on-year, while prices of vegetables were down by 3.61 per cent. Wheat prices fell by 0.06 per cent.
However, prices of other food items continued to rise.
In the non-food primary articles segment, fibres became dearer by almost 62 per cent, while minerals were up 11.95 per cent. Fuel and power became 12.11 per cent costlier year-on-year.
The government and Reserve Bank have said that in the months to come, inflationary pressure would be felt more from core (non-food) items on account of high global prices of commodities, particularly crude.
Headline inflation stood at 8.66 per cent in April, down from over 9 per cent in March. In its monetary policy for 2011-12, RBI had said that overall inflation would remain high in the near future, averaging 9 per cent during the first half of the fiscal, before moderating to around 6 per cent by the year-end.