Inflation rises to 3.5%

article segment, prices of coffee and vegetable moved up, while gram, moong, urad and rice became cheaper. Terming food prices as a cause of concern, finance minister P Chidambaram had said “All other prices are under control. There have been occasional flare ups. I am basically worried about the supply-demand mismatch. We have requested the ministries concerned to do a more rigorous and realistic assessment of supply and demand”.

The finance minister said he would be happy if there was a free inter-state movement of food articles. It would also help the cause if there were big retail chains for procurement and supplies, he added.

Analysts say the Government would not find it easy to keep inflation at below 4 per cent due to rising oil and food prices in the international market. Oil prices are likely to remain high in the coming days due to turbulence in the Middle East, and food prices would firm up due to drought in Australia. “In the next three months, inflation is likely to go up and we expect it to be around 5 per cent for the current fiscal,” Crisil principal economist D K Joshi said.

During the week, prices of manufactured items went up by 7 per cent, while butter and cotton seed oil rose by 2 per cent, and maida 1 per cent. Elsewhere, prices of bran shot by 4 per cent, coconut oil, oil cakes and atta moved up by 1 per cent each. Prices of cycle tyres jumped by 6 per cent, PVC pipes and tubings by 5 per cent. Cement got expensive by 0.1 per cent and body manufactured for buses rose by 12 per cent. However, oxygen gas cylinders were cheaper by 6 per cent, zinc prices by 5 per cent and zinc ingots by 2 per cent. Inflation figure was revised to 3.11 per cent for the week ended October 27 against the provisional figure of 2.97 per cent as wholesale price index finally stood at 215.4 points.