Inflation inched up further to 9.44% in June due to higher prices of fuel and manufactured items, a development which may lead to further rate hike by the RBI later this month.
Grappling with high prices situation, the Government came out with a statement saying it was working with the RBI to bring down inflation to a "comfortable level."
Inflation, as measured by Wholesale Price Index (WPI), rose from 9.06% in May. The April numbers too went up 9.74% from 8.66%. Headline inflation is above 9% mark since December 2010.
"Government is working together with RBI to take appropriate steps to reduce inflation to more comfortable level," Finance Minister Pranab Mukherjee said.
The index for the fuel and power segment stood at 12.85% year-on-year in June. This was up from 12.32% in the previous month. Diesel, Kerosene and LPG prices were revised in May.
Prices of manufactured products went up by 7.43% year-on-year in June from 7.27% in May.
In wake of sustained inflationary pressure, experts feel the RBI will again hike rates in credit policy on July 26 by at least 25 basis points.
"While the RBI is likely to go ahead with another round of rate hike, it is important to identify the pressure points in the economy giving rise to high inflation levels," Deloitte Haskins & Sells director Anis Chakravarty.
In line with overall inflation, the weekly food index too rose to 8.31% for the week ended July 2 as against 7.61% in the previous week.
However, month-on-month food inflation in June was flat at 8.38%.