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Hoarding also responsible for rising inflation: Arun Jaitley

Monday, 16 June 2014 - 9:19pm IST | Place: New Delhi | Agency: PTI

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Attributing rise in inflation partly to withholding of food stocks by traders, Finance Minister Arun Jaitley on Monday said the Centre is committed to ease supply side bottlenecks and has also asked states to take firm measures against hoarders to check speculation.

"The Government is seized of the matter and is committed to ease supply side constraints. The rise in prices of food articles can also be attributed to withholding of stocks on account of apprehension of a weak monsoon," he said.

He was commenting on the Wholesale Price Index (WPI) data which showed that inflation jumped to five-month high of 6.01% in May primarily on account of costlier food articles, fuel and power costs.

The Union Finance Minister said the state governments should take effective steps to ensure that hoarding is discouraged.

"The Government is committed to take measures which will positively impact the GDP and result in higher growth than expected. I am hopeful that the inflation which is moving upwards now would eventually come down," Jaitley said.

Referring to the rupee slide against dollar, he said the Government is watching the movement of the domestic currency closely.

"The slight instability of rupee is essentially because of Iraq oil shocks and global fear of oil price rise," he said.

The rupee on Monday slipped below 60-mark and closed sharply down by 39 paise at a six-week low of 60.16 against the dollar on sustained demand of the American currency from oil importers, amid rising oil prices.

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