Food inflation will dip: Chawla

Jul 06, 2010 - Age Correspondent |

New Delhi

The finance secretary Ashok Chawla said on Monday that it will take sometime before food inflation falls to an acceptable range of around 5 per cent.
“Food inflation is going down. It will take some time before it really comes into a range which is acceptable to the government and which is good for the people,” said Mr Chawla.

Food inflation was 12.92 per cent for the week ended June 19. It has been in double digits for sometime now. While it was expected that when the rabi crop hits the markets, it will soften the food prices. But till now the impact has been a muted one. Now analysts say that any decline in food prices will depend on how the monsoon behaves.
Food inflation declined by almost 4 percentage points to 12.92 per cent for the week ended June 19. Several analysts attributed the decline to the base effect, rather than any real decline in prices.
Mr Chawla said that overall inflation will fall to 6% by December. The RBI has projected that inflation will come down to 5.5% by March 2011. Inflation was in double digits at 10.16 per cent in May. The rising prices have now turned into a hot political issue.

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