Inflation declines to 7.25% in June; food prices harden

Inflation declined to 7.25 per cent in June as prices of manufactured items eased a little, although vegetables, wheat and pulses became costlier.

Inflation, as measured by the Wholesale Price Index (WPI), was 7.55 per cent in May. In June last year, it was 9.51 per cent.

Overall food inflation rose to 10.81 per cent in June, from 10.74 per cent in May. In June last year, inflation rate in this category was 7.6 per cent. Food articles have 14.3 per cent share in the WPI basket.

In the manufactured items category, prices of cotton textile, rubber and plastic products, iron and machinery eased a little year-on-year basis.

The rate of price rise in the manufactured products was 5 per cent in June, as against 7.9 per cent in the same month last year. In May this year, it was 5.02 per cent.

In food articles category, rice turned expensive by 6.70 per cent in June, wheat 7.46 per cent, pulses 6.82 per cent and vegetables by 20.48 on annual basis.

On month-on-month basis, poultry chicken prices were up by 7 per cent, gram 6 per cent, masur 4 per cent, and fruits & vegetables, egg, arhar, rice by 2 per cent each. Tea, milk, wheat and mutton were up 1 per cent each.

Easing of inflation has raised some hopes of cut in interest rate by RBI at its monetary policy review later this month.

Meanwhile, inflation for April has been revised upwards to 7.50 per cent, from the provisional estimate of 7.23 per cent.