Higher prices of onion along with other vegetables and fruits pushed up inflation for the fourth month in a row to 6.46% in September, making it difficult for the RBI to cut rate in the monetary policy review due later this month. The inflation, based on wholesale price index (WPI) was at 6.1% in August and 5.85% in the previous month.
The sharpest increase was witnessed in case of onion prices which jumped by 323% year on year in September. The price of vegetables in general rose by 89.37% making life difficult for the common man. Fruits too were costlier by 13.54% year-on-year during the month.
As per data released by the government today, the food inflation stood at 18.40% in September over the same month last year. The food prices had shot up 18.18 per cent in the previous month. Inflation in the LPG (liquefied petroleum gas) and petrol was at 9 per cent and 9.64 per cent, respectively, on annual basis.
However, there was decline in prices of egg, meat, fish and manufactured food items like beverages and tobacco products. Overall, inflation in manufactured items showed a moderate increase of 2.03% during the month on annual basis. The Reserve Bank is scheduled to unveil its second quarter review of monetary policy on October 29 and will have to take into account the rising inflation while announcing steps to boost economic activities.