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Households continue
to feel the inflation pinch
New Delhi, June 19 Headline inflation may have turned negative,
but households continue to feel the pinch.
Prices of most essential
food items are still showing double digit increase in prices, with
no let-up in the prices that people pay.
A look at latest data collected
by the Price Monitoring Cell of the Department of Consumer Affairs
shows that prices of daily use items such as rice, potatoes, onions,
sugar, salt and tea have registered a substantial surge on a year-on-year
basis.
While the latest WPI (wholesale
price index) data does point to high food-related inflation, with
the overall food index showed a 9.4 per cent increase during the
latest reported week (ended June 6), the price rise translated at
the retail level is amplified several times over.
Retail prices of sensitive
items including onions, potatoes and sugar continue to show substantial
increase over last year’s levels across all the four major
centres. Rice and tur (pigeon pea) prices have also shot up substantially
across nearly all centres on a year-on-year basis.
Price rise in items such
as tea has seen a spurt across the northern and southern centres,
while salt prices have also shot up across major centres around
the country.
Edible oils including groundnut
oil, mustard oil and vanaspati have been exceptions, showing either
a dip in prices or only a marginally increase in retail prices
“Food inflation is
dangerous as it tends to hit the poor the hardest,” an analyst
said, adding that the disconnect between the WPI inflation levels
and the price rise seen at the retail level depends on the market
structure for each of the particular product and also on the levels
of middlemen that exist in the trade.
WPI-based inflation peaked
last August at 12.5 per cent, before falling to minus 1.61 per cent
for the week ended June 6.
According to analysts, while
lower production of sugar has primarily led to higher prices, prices
of pulses have continued to remain high as the cost of imports has
gone up due to a weakening rupee. Onion prices continue to stay
high despite an expanded acreage under the winter crop and increased
arrivals in the sport markets, mainly due to booming exports.
The essential commodities
for which the cell monitors the prices are rice, wheat, atta, gram,
tur (arhar ) dal, sugar, gur, groundnut oil, mustard oil, vanaspati,
tea, milk, potato, onion and salt. Information on retail prices
is received on a daily basis from 18 centres in the country.
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