Food price inflation softens a little

Inflation in the Food Articles group declined slightly to 18.65% in the week ended December 12, but continued to remain near 11-year high. It was 14.98% in the previous week. Inflation for the Primary Articles group increased to 14.66% from 14.98% in the first week of December. Meanwhile, inflation in the Non-Food Articles group rose to 7.97% as against 5.70% in the week ended Dec. 5 and inflation for the Minerals group stood unchanged at (-)3.28%. Inflation for Fuel & Power group also remained unchanged at 3.95%.

Finance Minister Pranab Mukherjee said that inflation was now a challenge for the Government. Planning Commission deputy chairman Montek Singh Ahluwalia said that an annual inflation of 5-6% was quite reasonable. The annual wholesale price inflation (WPI), which stood at 1.34% in October, rose to 4.78% in November. Monthly inflation could reach 8% by the end of the fiscal year in March, above the central bank's forecast of 6.5%.