After falling for three consecutive weeks, inflation rose marginally to 12.14 per cent in the first week of September as compared to 12.10 per cent in the previous week due to increase in the prices of primary articles, according to the data released on Thursday.
Inflation rose despite a fall in global crude prices. The products whose prices saw an increase in the week are fruits and vegetables (six per cent), urad and wheat (three per cent each) and castor seed and copra, mutton (one per cent). Some minerals like fire clay shot up by 37 per cent. However, the prices of maize and bajra (two per cent each) and jowar and condiments and spices (one per cent each) declined. Also the prices of aviation turbine fuel (17 per cent) and naphtha (one per cent) saw a decline.
Bank of Baroda chief economist, Ms Rupa Rege Nitsure said that the inflation has still not stabilised and it will rise further to 13 per cent. "I believe that inflation will peak at 13.5 per cent in November-December before coming down," said Ms Nitsure. She said that inflation will come down to single digit near the end of this fiscal year. "Inflation will be in the double digit on 31st December," said Ms Nitsure.
She also added that there is still upward pressure on the inflation due to high prices of primarily articles. Ms Nitsure said that RBI will hike the CRR rates and not repo rate as the supply growth is still at 21 per cent. Inflation for the week ended July 12 was revised up to 12.13 per cent from 11.89 per cent. The annual inflation rate was 3.46 per cent during the corresponding week of the previous year.
Meanwhile, finance ministry said in a statement that inflation has remained stable at 12.14 per cent. Inflation in the same period in the previous year at 3.51 per cent was significantly lower, it said.