India's annual inflation rose to 9.44 percent in June from 9.06 percent in the previous month, prompting Finance Minister Pranab Mukherjee to say that it “continues to be a matter of concern” and that the government and the Reserve Bank would take appropriate measures to bring it down to a comfortable level.
“Government is working together with the RBI (Reserve Bank of India) to take appropriate steps to reduce inflation to more comfortable level,” Mukherjee said while reacting to the monthly inflation data released Thursday.
According to figures released by the ministry of commerce and industry, the headline inflation based on wholesale price index rose to 9.44 percent in June from 9.06 percent in the previous month.
"Inflation figures reported for the month of June continue to be matter of concern. We are monitoring the price situation closely,” the finance minister said in a statement.
Mukherjee said inflation rose in June mainly because of increase in administered fuel prices, seasonal effects, an upward movement in mineral and manufactured prices and in part reflecting imported inflation.
Rise in inflation may prompt the RBI to hike policy rates further. In its latest mid-quarter review of the monetary policy in June, the RBI had hiked the key policy rates by 25 basis points. This was the 10th increase in rates in 15 months.
Meanwhile, after two weeks of moderation, food inflation rose to 8.31 percent for the week ended July 2 as against 7.61 percent in the previous week due to a sharp jump in the prices of onions, fruits and milk.