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Food prices to ease by year end: Montek

business Updated: Sep 03, 2009 19:58 IST

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The Planning Commission on Thursday said food prices would ease by year end despite drought conditions adversely affecting farm sector output.

"In the year as whole we will be able to contain aggregate inflation at comfortable level and reduce the rate of prices, particularly food prices, which are of course very high," Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters.

Although the inflation measured by changes in the Wholesale Price Index (WPI) has been in the negative for the past three months, retail food prices have continued to remain firm.

"The government is taking large number of... Measures. There is a Cabinet Committee that looks at it (prices) and reviews the situation constantly," he said, adding the price situation would ease in the days ahead.

Prime Minister Manmohan Singh in his recent address at a meeting of full Planning Commission had said, "we should not be over-pessimistic. We are in a very strong position to manage the consequences of the drought. Our food stocks in particularly very high."

According to the WPI data released on Thursday, the rising prices of food items like pulses, sugar and vegetables pushed up inflation to minus 0.21 per cent for the week ended August 22, a rise of 74 basis points over previous week.