Inflation falls to 5.77%

A decline in prices of food items such as eggs, wheat and pulses as well as a few manufactured products pulled down inflation to 5.77 per cent during the week ended April 21 from 6.09 per cent in the previous week.

Official data released on Friday showed that prices of major food products like eggs, meat, fish, urad, wheat, jowar and arhar declined, while those of fruits, vegetables, poultry chicken, masur, gram and barley moved up.

Iin manufactured category, food products became cheaper with decline in prices of sunflower oil, imported edible oil, and unblended black tea leaf. However, prices of coconut oil and gingelly oil went up. This would give some respite to the government, trying hard to bring down prices and ease pressure on the Reserve Bank to increase interest rates. Cabinet Committee on Prices reviewed prices, especially of food items on Thursday.

Minerals

like vermiculite and magnesite turned expensive, and so did fodder, gingelly seed, some chemical, metal and fuel items.

However, certain other minerals like steatite, textile items and machine tools turned cheaper. The data came a day after Finance Minister P Chidambaram announced excise and customs duty concessions in cement, iron ore fines, biscuits, bidis, nickel and other items while expressing the government's resolve to bring down inflation rate ultimately to below 4.5 per cent.

"Average inflation in 2006-07 was 5.4 per cent. In government's view, this is high, and requires to be contained below 4.5 per cent," Chidambaram had said in Lok Sabha.

In fact, he had predicted inflation to come down to close to 5.70 per cent in the week ended April 14 after it had risen to 6.09 per cent earlier. His prediction proved almost correct, but with a lag of one week.