The Hindu : Front Page : Inflation up again

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Saturday, Jul 05, 2008
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Inflation up again

Special Correspondent

NEW DELHI: The rate of inflation crept up to touch another new 13-year high at 11.63 per cent for the week ended June 21 from 11.42 per cent the previous week.

This was mainly due to the higher prices of cereals, fruits and vegetables and manufactured items such as edible oils, cement and steel.

Although the wholesale price index-based inflation at this level was way above the 4.32 per cent pegged for the same week a year ago, the country’s bourses factored in the price spiral to close with substantial gains as nervous investors in the market were earlier anticipating an inflationary spurt to well over 12 per cent.

Hailing the lower-than-expected inflation, the markets pulled back by way of short-covering even in the wake of soaring global crude oil prices. While the Bombay Stock Exchange’s 30-share Sensex smartly gained nearly 360 points to close at 13,454, the 50-share Nifty of the National Stock Exchange also rose by 90.25 points to end the day’s trading at 4,016.

The market euphoria, however, is likely to be short-lived as crude oil prices have been hovering in the region of $145 a barrel.

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