The Wholesale Price Index-based inflation, which stood at 9.89 per cent in February, is on rising mode due to rise in prices of essential commodities including key food items. However, food inflation for the week ended April 3 declined moderately to 17.22 per cent from 17.70 per cent in the previous week. Inflation is also under pressure as manufactured goods, whose production has gone up in recent months have started witnessing rise in prices.
Further, the upward movement of overall inflation is emerging as a concern for the Centre and the RBI. The overall inflation has already breached RBI’s projection of 8.5 per cent by end of this fiscal in January this year and with the overall inflation rate going much beyond the comfort level of 5 per cent, RBI is likely to tighten money supply when it meets on April 20 for reviewing its monetary policy. RBI also indicated that it will continue with its stimulus exit policy even as the industry wants the contrary.
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