Inflation continues downward march

MUMBAI, Dec 7: Annual inflation slid fractionally down by 0.01 percentage points to 3.35 per cent for the week ended November 22.In the ref...

MUMBAI, Dec 7: Annual inflation slid fractionally down by 0.01 percentage points to 3.35 per cent for the week ended November 22.

In the reference week, inflation, based on the wholesale price index (WPI), moved to 3.35 per cent from 3.36 per cent in the previous week and 6.76 per cent during the corresponding week last year. The index for "all commodities" (base 1981-82=100) went up during the week to 329.9 (provisional) from 329.6 the last week.

Except for the last one week, inflation has been undergoing a downward trend when it had slumped by about one percentage point in a matter of just four weeks only. Economists have been suggesting an upturn in inflation in the latter half of the current fiscal as the economy moved out of the slowdown.

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The fall, despite recent hikes in prices of petroleum products and rail freight charges, has been attributed to a slackening of demand in the economy.

Meanwhile, according to the latest figures available, inflation based on the final index remained unchanged at 3.5 per cent for the week ending September 27 compared to the previous week.

In the corresponding week, inflation based on the provisional index also remained unchanged at 3.8 per cent compared to the earlier week. The final index for all commodities for the week stood at 328.1 as against the provisional index of 329.1.

Economists said with polls round the corner, the inflation will look up as the liquidity in the economy goes up. So far except for the group "fuel, power, light and, lubricants" (which have most of the commodities under administered price mechanism), prices of other two groups – "primary articles" and "manufactured products" – have been seeking lower level in the past one year. During the year, the prices of primary articles and manufactured products increased by just 1.70% and 2.89% compared to 10.63 per cent increase in fuel, power, light and lubricants.