IndiaSphere

The trouble with the recent brouhaha over inflation is that it seems to be based on impressions rather than facts. The local media, for one, which has become remarkably vigilant over the price rise issue, seems to be working on two premises. The first is that global food prices are exceptionally high, which is correct. The second premise is that high global prices and local food shortages are driving domestic inflation to levels close to 8 per cent – this is by no means entirely correct.Since weekly inflation numbers, for what they are worth, seem to be guiding our industrial, export and monetary policy, it is important to get a handle on what they tell us. Let’s look at the data for April 19, released on May 2. The aggregate inflation rate printed at 7.57 per cent for the week.The latest data release for April 26 incidentally shows a similar ... [Follow Original Article link for full content.]