Inflation at 3-yr high, Chidambaram talks of steps

PRICE WOES: Govt says it’s helpless in the face of the global onslaught of surging crude prices.

Other stories in the section:

Inflation up at 11.63 per cent

This is the highest in more than 13 years, above the previous week's 11.41 per cent.

• Markets under selling pressure, Sensex closes below 13k
• Inflation still in double digits, surges to 11.42 pc
• Oil prices slide to less than $142 per barrel
• Pepsi drops Tendulkar, opts for cricket's Youngistan

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• Inflation up at 11.63 per cent
• Markets under selling pressure, Sensex closes below 13k
• Inflation still in double digits, surges to 11.42 pc
• Oil prices slide to less than $142 per barrel
• Pepsi drops Tendulkar, opts for cricket's Youngistan

Keywords: inflation, price rise

New Delhi: Another Friday and a new figure for inflation. This time the wholesale price index rose to a 42 month high of 7.61 per cent for the week ending April 26.

The reasons for the spike came from higher food prices. Tea prices rose by 11 per cent spices were more expensive by 3 per cent while fruit prices were up 2.3 per cent.

The Government says it’s helpless in the face of the global onslaught of surging international crude prices, which it says is further pushing up the price of food. But it will still try and take more steps to tame inflation.

Finance Minister P Chidambaram said, "More administrative steps will be taken as and when they become necessary to check inflation, Chidambaram said while pointing out that government was trying to persuade cement manufacturers to cut prices.”

India has been indirectly hit by the rising price of crude oil. Even though international prices nudge the $125 mark, in India prices at the retail end have not changed. But economists say this is simply postponing the problem.

Economist B B Bhattacharya says, “It’s a ticking time bomb waiting to explode soon. The country should be prepared for it.”

While the government is unlikely to change oil prices, it believes inflation can come down by 100 bps in mid-June.

But experts feel its unlikely to happen with skyrocketing food, fuel and metal prices, it could be staring at an even bigger problem in the coming months.