Food Inflation falls to 7.7 %

Good news, food inflation for the week ended June 18 fell to 7.78 per cent from 9.13 per cent as measures in the previous week.

According to the data released by the government of India, the vegetable were cheaper by 10 per cent for the week ended June 18.

The food items weights 20 per cent of the WPI. Headline inflation was at 9.06 per cent in May 2011.

The government's recent hike in the price of diesel, LPG and kerosene, seem have not impact on the food inflation.

Experts were speculation that hike might fuel the spiral inflation in India. Some extend that is possible in the long-term, and the headline inflation may go up to double digit.

The inflation was in double digit previous year. RBI had raised the interest rated for 10 times since March 2011 to contain the inflation.

The fall in the food inflation is a big relief for the government, as it has been criticized for its economic policies.