Concerned over surging prices, Finance Minister P Chidambaram said on Friday the government will not hesitate to take more fiscal and monetary measures to contain inflation.
"We will take more monetary and fiscal steps if needed to curb inflation," Chidambaram said.
Wholesale price-based inflation crossed 5 per cent mark to 5.24 per cent for the week-ended June 10.
Chidambaram said higher fuel prices, following Rs 4 and Rs 2 increase in petrol and diesel prices on June 5, was responsible for pushing the inflation rate to over 5 per cent.
"Current spurt in inflation was due to pass through of fuel prices," he said.
"Monetary steps have been taken, some fiscal steps and action were announced on Thursday..I am confident these steps will help moderate inflation, " Chidambaram said.
In a surprise action, Reserve Bank had increased the key short-term rates (repo and reverse repo) by 0.25 per cent on June 8 to address inflationary concern after fuel price hike.
Feeling the pinch after essential items became costlier, government on Thursday allowed import of wheat, pulses and sugar without any restriction as short-supply of these were also blamed for higher inflation.
Inflation is always a matter concern for any government, Chidambaram said.
"Our government came to office when inflation was moving upward (2004-05), then we said we will moderate it and suceeded," he said.
Throughout the second part of 2004-05, inflation was moderate, he said, adding that it was not first time inflation has been on the rise.
In 1998-99, inflation was over 7 per cent for seven consecutive weeks, in 2000-01 inflation was over 7.2 per cent, he said.Do you want to discuss stock tips? Do you know a hot one? Join the Stock Market Investments Discussion Group