"It is 10.55%. After the kharif season is over, there will be a moderating impact which is already being felt," finance minister Pranab Mukherjee said
Attributing the double-digit inflation to the petro hike, finance minister Pranab Mukherjee today said that prices would moderate by the end of the kharif season, and inflation would come down to 5%-6% by the year-end, reports PTI.
"I do feel that the annual rate of inflation will be 5%-6% (by 2010-end)," Mr Mukherjee told reporters on the sidelines of a function relating to the setting up of an investment fund between India and Oman.
Wholesale price index (WPI) based inflation inched higher to 10.55% in June, owing to the pass-through effect of the hike in prices of petroleum products announced on 25th June.
"It is 10.55%. It is hovering around double digits. After the kharif season is over, there will be a moderating impact which is already being felt," he said.
Inflation figures in June were expected to move up due to the impact of the petro price hike, he added.
The minister had earlier said that the fuel price hike would impact WPI inflation by less than a percentage point.
The government had, on 25th June, hiked petrol prices by Rs3.5 a litre while deregulating them, and diesel by Rs2 a litre. Besides this, it raised the price of LPG (cooking gas) by Rs35 a cylinder and kerosene by Rs3 a litre.
The sowing of kharif crops began in June, with the onset of the South-West monsoon, and will continue till September. The crops will start arriving in October.