While the price rise in the food and beverages category was at 5.34 per cent in October, inflation in cereals and products was also higher at 1.46 per cent.
Advertisement
The inflation rate has been negative in ten of the last eleven months.
Miscellaneous items, which includes household goods and services, health, transport and communication and has a weightage of 27.26 per cent, rose 3.51 per cent year-over-year in October. That was higher than the 4.8% increase predicted by economists. The biggest factor leading to the price rise was the price of pulses which rose 42.2% in October.
The inflation rate based on the Consumer Food Price Index (CFPI) was 5.18 percent in rural areas and 5.47 percent in urban areas, working out to a combined rate of 5.25 percent. But the government said in a separate statement that the prices should ease soon as a few 4,660 tonnes of pulses had been seized from hoarders and auctioned or disposed off in the market. Punjab reported the least inflation of 3.18 percent, followed by 3.37 percent in Kerala and 3.8 percent in Haryana.
Commenting on the numbers, industry body CII said: “Despite the moderation in September industrial growth compared to the previous month, we expect a pick up in the third quarter. Investment demand is also picking up as public sector projects are being implemented by the government”, Banerjee added.
Analysts hope that inflation may moderate once festival demand softens and prices of lentils and vegetables fall as imports increase.
“Consumer price inflation is right in line with expectations”.
Advertisement
Crisil Chief Economist Joshi said the higher-than-anticipated inflation data meant that Reserve Bank of India (RBI) Governor Raghuram Rajan may not go in for a rate cut in the next monetary policy meeting in the first week of December.
