After witnessing a declining trend last week, India's annual food inflation rate rose to a two-month high of 9.01 per cent for the week ended May 28 on the back of costlier cereals, milk, fruits, rice and onion.

Food inflation was in double digits for most of last year, before showing signs of moderation from March this year. It remained in single digit for the eleventh consecutive week.

Annual inflation rate of food article prices, as measured by the wholesale price index, or WPI, (with base year 2004-05) for the week ended May 28 rose to 9.01 per cent from 8.06 in the preceding week.

Percentage of inflation for the corresponding week in the preceding year was 20.62 per cent. The 52-week average inflation for the week ended May 28 was 13.60 per cent, according to data released by the Ministry of Commerce & Industry.

Annual percentage of inflation for "Non-Food Articles" fell to 20.97 per cent from 21.31 in the preceding week. The 52-week average inflation for the week ended May 28 was 23.74 per cent.

Primary articles

Annual rate of inflation for the week ended May 28 was 11.52 per cent, up from last week's level of 10.87 per cent. It was 20.25 per cent for the corresponding week of the preceding year. The 52-week average inflation for the week was 16.22 per cent, the data revealed.

The index for this group, with a weightage of 20.12 per cent, increased by 0.52 per cent from the previous week's level.

These groups and items showed variations:-

Higher prices of tea, pork, maize, jowar, fish-inland, milk, egg, urad, barley and wheat pushed up the index for "Food Articles" by 0.64 per cent. However, the prices of ragi, arhar, condiments and spices, bajra and masur declined.

The index for "Non-Food Articles" increased by 0.38 per cent due to the higher prices of flower, linseed, mustardseed, groundnetseed and cottonseed, while those of raw silk, gingellyseed, sunflower, copra, fodder, soyabean and raw jute dropped.

Fuel, Power, Light & Lubricants

Annual rate of inflation under this category for the week ended May 28 was 12.46 per cent, down marginally from the previous week's level of 12.54 per cent. The 52-week average inflation for the week was 12.07 per cent, the data said.

Index for this major group carrying a weightage of 14.91 per cent remained unchanged at its previous week's level of 160.7.

Addressing a conference of leading Indian and overseas institutional investors in New Delhi on Tuesday, Finance Minister Pranab Mukherjee said inflation might moderate in the months ahead, especially as the monsoons were expected to be normal strengthening the economic prosperity of the farmers.

Inflation remained at an elevated level despite the Reserve Bank of India's tight monetary policy stance. The apex bank had raised its lending (repo) and borrowing (reverse repo) rates nine times since March 2010.

RTTNews