New Delhi: Inflation eased in the month of November and declined to 7.24 per cent from 7.46 per cent in the previous month and 9.46 per cent in November, 2011. Reserve Bank of India (RBI) Governor C Rangarajan while announcing the figure said, "I do not think economy can bear very high rate of inflation."
Inflation, as measured by the Wholesale Price Index (WPI), stood at 7.45 per cent in the previous month. Food inflation, as a category, rose to 8.5 per cent during the month, from 8.32 per cent a year ago. Food articles have 14.3 per cent share in the WPI basket.
Vegetables prices declined by 1.19 per cent in November, 2012 as compared to surge of 10.68 per cent in same month a year ago. Potato and onion prices, however, shot up by 72.20 per cent and 17 per cent respectively year on year in November, 2012 as compared to a decline of 9.31 per cent and 35.15 per cent in the same period in 2011.
Wheat turned expensive by 23.19 per cent in November from a decline of 4.86 per cent in November, 2011. Cereals became dearer by 15.85 per cent from a rise of 2.15 per cent in November, 2011. Pulses and eggs, meat and fish became costlier by 19.10 per cent and 14.19 per cent in November. These food items also saw a surge in prices by 14.96 per cent and 11.40 per cent in November, 2011.
For the fuel and power category, inflation moderated to 10.02 per cent during the month from 15.48 per cent in November 2011. However, diesel inflation increased by 14.60 per cent in October 2012. In the manufactured items category, prices of cotton textiles, man-made textile, iron and steel paper and paper products, rubber and plastic products rose relatively at a lower pace compared to the same month of the previous year.
The rate of price rise in the manufactured products was 5.41 per cent in November, as against 8.17 per cent in the corresponding month of 2012. Inflation for September was revised upwards to 8.07 per cent from 7.81 per cent as per provisional estimates.
Rangarajan also said that he doesn't expect the RBI to cut interest rates at its next policy meeting on December 18. India is headed for the weakest full-year growth in a decade, at about 6 per cent, far below the near double-digit pace before the global economic downturn.
But despite the slowdown, the RBI has not lowered interest rates since April because inflation has remained near 7 per cent, exacerbated by a weak rupee that has added to the cost of fuel imports.
With Additional Inputs from Agencies