Higher prices of manufactured items and some food articles like vegetables and barley pushed up inflation to 3.42 per cent during the week ended September 22 as against 3.23 per cent in the previous week.

Wholesale prices-based inflation has been on a downhill trend for the past few weeks and this is the first time in five weeks that it has risen.

During the week under review, rise in inflation was mainly on account of the 0.5 per cent increase in prices of manufactured items, which account for slightly less than two-thirds of the total weightage.

Within target
Inflation, however, remains well within RBI’s target of close to 5 per cent for this fiscal. The price index was at 5.43 per cent in the corresponding week a year ago.

Inflation figure was revised to 4.70 per cent for the week ended July 28 against the provisional figure of 4.45 per cent as wholesale price index finally stood at 213.9 points compared to earlier estimate of 213.4 points.

This was the 16th week the inflation rate has been under 5.0 percent, the central bank's target for the 2007/08 fiscal year.

Analysts said they expected inflation to rise in the weeks to come. Financial markets remained cool to the data with the yield on the 10-year government bond steady at 7.91 per cent and the rupee holding at 39.48/49 per dollar.