Spiralling prices of onion and other vegetables pushed the wholesale price inflation (WPI) to an eight-month high of 7 per cent in October. Food prices remained elevated, though the rate of increase dropped marginally to 18.19 per cent as compared with 18.4 per cent in September, data showed.
Retail prices of onions have quadrupled in some cities over the past three months, serving as a powerful reminder of the impact on consumers. Onion prices jumped by an annual 278.21 per cent in October as compared with a 78.38 per cent rise in vegetable prices.
Protein rich items like egg, meat and fish became costlier by 17.47 per cent against 13.37 per cent in September.
Rising food prices had also been reflected by data on Tuesday showing consumer price inflation accelerated more than expected in October, to 10.09 per cent from September's annual pace of 9.84 per cent.
Two days ago, Reserve Bank governor Raghuram Rajan described India's food inflation as "worryingly high". Still, Dr Rajan sought to address concerns about inflation at Wednesday's news briefing, and analysts have interpreted the remarks as signalling reluctance to raise India's key lending rate - the repo rate - which currently stands at 7.75 per cent. (Also read: Why the RBI may raise rates in December)
The Reserve Bank of India has already hiked the key repo rate by 25 basis points (0.25 per cent) twice since Dr Rajan took over as the governor in September.
Source:- profit.ndtv.com
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