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Inflation jumps to 4.78% in November

New Delhi, Dec. 14: The government is expected to take steps to rein in inflation that leaped to 4.78 per cent in November from just 1.34 per cent a month ago.

“There is an inflationary pressure on food items. It is a matter of concern,” finance minister Pranab Mukherjee said.

The government has asked state governments to ensure that the public distribution system provides foodgrains at controlled rates to the poor. The food price index rose at an annual rate of 16.71 per cent in November from a year earlier.

Though rising inflation is mainly being driven by a surge in food prices, prices of manufactured products have started rising as economic activity has picked up.

Finance secretary Ashok Chawla said the government was concerned about rising inflation, but there was no need for emergency action at this stage. The numbers are within the range set by the central bank and the government. “So, it is not as if we are taken by surprise or there is any cause for any special emergency action,” Chawla said.

Analysts expected the RBI to tighten key interest rates but said the monetary policy could do little to check the price rise. The central bank has revised the inflation forecast to 6.5 per cent by March-end from 5 per cent.

Commerce minister Anand Sharma said, “Rising inflation is a cause for concern. The government is monitoring the prices of essential commodities.”

During the 12-month period under review, the index for manufactured products was up 1.2 per cent.

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