New Delhi, April 13 (PTI): Inflation rate surged to a two-year high at 6.24 per cent during the week-ended March 29 from about 1.6 per cent a year ago, as the Iraq war pushed up input costs and prices of manufactured items. Price level rose 0.25 per cent from 5.99 per cent in the previous week as primary essential items became costlier after the drought-hit kharif and flat rabi harvests.
The wholesale price index (WPI), based on all commodities, rose by 0.2 per cent to 171.9 points from 171.6 in the previous week, mainly due to 0.3 per cent rise in prices of both primary articles and manufactured products, although domestic fuel prices remained static.
The final inflation rate was 5.29 per cent during the week ended February 1, as against the provisional figure of 4.86 per cent, while the final WPI was at 169.1 points compared with the provisional 168.4 points.
Economists relate the surge in prices to the war in Iraq, which resulted in rise in global oil prices since January and input costs for the manufacturing sector. Coupled with this, industrial recovery and the capacity constraints led to the rise of manufactured product prices, said Subir Gokarn, chief economist at Crisil. The prices of essential food and non-food items rose due to the post-monsoon impact, he added.
Primary articles index rose to 177.8 from 177.3 in the previous week due to 0.3 per cent rise each in the prices of food and non-food items.