Food inflation in India drops

Food inflation declined by over a percentage point and dropped to 10.35 per cent during last week from 11.40 per cent in the previous week. Food inflation data showed that vegetables become cheaper by 22.12 per cent, while the prices of potato and onion in the wholesale market declined by 49.81 per cent and 6.91 per cent respectively.

 However, experts claim that this fall may not prompt the Reserve Bank to reverse its tight money policy stance at the next review on September 16. Analysts expect that food inflation will continue to fluctuate for some more time before showing declining trend on arrival of new crops.

It would be worth mentioning that the overall inflation, which include prices of manufactured goods besides food items, fell to single digit at 9.97 per cent in July end, after a gap of five months.