INFLATION SOARS TO 14 MONTH HIGH

Costly vegetables, particularly potato and onion, pushed the November wholesale inflation to a 14-month high of 7.52 per cent, making it difficult for the Reserve Bank to ease key policy rate. Vegetable prices shot up by 95.25 per cent in November as compared to 78.38 per cent in the previous month, said the Wholesale Price Index (WPI) inflation data released today. The overall inflation in the food segment comprising wheat, pulses, vegetables, milk, among others, was at 19.93 per cent, up from 18.19 per cent in October. The rise in WPI comes after the retail or consumer price inflation jumped to 11.24 per cent. The inflation was at 7 per cent in October and 7.05 per cent in the earlier month (revised upwards from 6.46 per cent). Potato prices shot up by 26.71 per cent in November as compared to a contraction in the previous month. The onions too were costly, but the price rise was low as compared to October. Onion inflation was at 190.34 per cent in November. The data further revealed that protein rich items like egg, meat and fish were costlier by 15.19 per cent while milk was dearer by 6.25 per cent in November. The inflation in fuel and power segment was at 11.08 per cent in the month under review, up from 10.33 per cent in October. The price rise in the manufactured products rose to 2.64 per cent from 2.50 per cent. The WPI inflation for November 2013 is the highest since September 2012 when it was 8.1 per cent. Amid slowing industrial production, the RBI is scheduled to review the monetary policy on December 18. It had hiked the key lending rate by 0.25 per cent in each of its previous two policy reviews to contain inflation.