The food inflation rate shot up to 11.43% for the week ended October 15, the sharpest increase in six months.The last time that food inflation stood this high was on April 9 at 11.53 %.
Just two days ago, the Reserve Bank of India (RBI) governor, D Subbarao — while announcing the 13th interest rate hike in 19 months — however, said the central bank could foresee prices declining from December onwards.Costly vegetables and fruits fuelled the prices with 25% and 12% jumps, respectively, on annual basis. It rose 10.60% (annualised) in the previous week. But non-food prices showed some decline - suggesting that the interest rates hikes have worked.
Rajeev Malik, senior economist at broking and research firm CLSA, Singapore, said, "Food inflation has jumped due mainly to a sharp increase in the prices of primary food items.
He said protein-rich food items — egg, meat and fish prices — and some categories of fresh produce (vegetables and fruits) were the key culprits. Importantly, even a decent monsoon harvest is unlikely to lower the inflation in protein-rich items.