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Inflation edges up in India

March 14, 2013 at 6:38 AM   |   Comments

NEW DELHI, March 14 (UPI) -- India's annual inflation rate reached 6.84 percent in February, reversing a downward trend over the past four months, the government said Thursday.

It wasn't clear how the new numbers announced by the Ministry of Commerce and Industry would affect India's central bank in its decision next week on whether to lower interest rates as is widely expected.

The ministry's figures indicated the wholesale price index, India's main inflation gauge, rose to 6.84 percent in February from 6.62 percent in January due partly to higher food costs as well as rising fuel prices. The rate was 7.56 percent in February 2012.

Although the February food inflation rate was down from January, it remained high at 11.38 percent. Food prices account for 14 percent of WPI.

Besides inflation, the Indian government has been battling rising deficits, current account deficit, tight money and a slowing economy, India's gross domestic product in the current fiscal year, ending March 31, is forecast to hit a decade low of 5 percent.

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