New Delhi: A day after the latest inflation data showed the highest ever surge in food prices in two years, Finance Minister Arun Jaitley has called a review meeting today to check the spike.
The meeting to review the sharp rise in food prices, especially vegetables and pulses, will be attended by Transport Minister Nitin Gadkari, Food and Civil Supplies Minister Ram Vilas Paswan, and Agriculture Minister Radha Mohan Singh among others.
Steps to check food inflation as well as efforts being taken to boost supply of pulses through its newly-created buffer stock and also from imports are likely to be discussed in the meeting today.
With potatoes 60 per cent dearer in bulk markets and pulses costlier by 36 per cent over the past year, India’s annual wholesale inflation rose for the second month in May to its highest levels in nearly two years at 0.79 per cent, official data showed on Tuesday.
The faster-than-expected rise in wholesale prices comes on top of consumer prices (retail inflation) surging 5.76 per cent in May, the fastest rate in 21 months.
The WPI inflation print in May compared against 0.34 per cent rise in April and (-) 0.45 per cent in March. WPI inflation stood at (-)2.20 per cent in May last year.
Tomato prices in most retail markets across the country have doubled to Rs 80 per kg in the last 15 days due to sluggish supply owing to crop damage. Potato rates have also been on the rise.
According to Tuesday’s data, pulses are also dearer by 11.34 per cent (nearly Rs 170 a kg), while milk is now costlier by 9.39 per cent.
Inflation was one of the reasons why the RBI left its key policy rates and reserve rations unchanged, despite a clamour for cuts from stakeholders due to the successive poor showing by the manufacturing sector.
Now, with the rise in both retail and wholesale inflation, the chances of a near-term rate cut appears even more bleak, going by the indications given by the RBI last week.