Food Inflation Recorded Growth Of 0.8%

Reserve Bank of India (RBI) has delivered a surprise 50 bps hike in the first quarter of the annual review of the monetary policy statement, 2011-12 announced on 26 July 2011. The RBI has raised interest rates sharply, such as loans to banks, 50 bps 8.0% with immediate effect. As a result, may increase the repo rate, reverse repo rate in which the RBI to borrow excess liquidity in banks, are standing is automatically adjusted to 7.0%, and the liquidity of the system marginal (MSF) 9.0% interest rate immediately. With the latest hike, the RBI raised its key interest rate eleven times in the past 16 months and a cumulative 325 bps from 4.75%.

Inflation remains dominant macro-economic concerns. The level and persistence of inflation IPM is a concern.

The RBI has revised the baseline projection for the WPI inflation rate in March 2012 up 7.0% to 6.0% in May 2011 establishes a policy.

The index for primary articles group rose by 0.2% to 198.0 (provisional) during the week ended July 16, 2011 to 197.7 (provisional) from the previous week. The annual rate of inflation, calculated on point to point, was 10.49% (provisional) for the week ended July 16, 2011 compared to 11.13% last week ended July 9, 2011.

The index for the group “The food items” increased from 0.8% to 193.3 (Provisional) from 191.7 (Provisional) for the previous week due to higher prices for fresh water fish, the fruits and vegetables and fish-marine (2%) and bajra, gram, herbs and spices, rice and tea (1% each). But the price of jowar (4%), ragi and poultry chicken (2%) and Kurt Masur, arhar and eggs (1% each) declined.The index for the group ‘non-food items increased by 0.3% at 176, 4 (provisional) from 175.9 (Provisional) for the previous week due to the rising prices of flowers (16%), groundnut seeds (10%), seeds of Gaur ( 3%) and rapeseed and mustard seed and castor seed (1% each.) But the price of raw cotton (6%), raw silk (3%), copra and raw rubber (2% each) and sesame seeds, flax and food (1% each) declined. NRI Share Trading Account.

Index “Minerals Group fell 3.7% 303.0 (Provisional) from 314.7 (provisional) in the previous week due to the price of zinc concentrate (33%), barite, and limestone (12% each) , iron ore (10%), steatite (8%) and chromite (2%). However, the prices of bauxite (11%), sillimanite (5%) upward.

The index of fuel and power group remained unchanged at its previous week level of 165.6 (provisional). Annual rate of inflation, calculated on the basis of points, was 12.12% (provisional) for the week ended July 16, 2011 compared to 11.89% last week ending July 9, 2011.


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