Inflation for the week ended March 07, 2009 fell to an all time low of 0.44% as compared to 2.43% a week earlier. The sharp fall in inflation was due to several factors including lower prices of food and fuel items. Annual inflation as measured by Wholesale Price Index (WPI) was at 2.42% in the week before and at 7.78% in the corresponding week last year.
The inflation for food articles eased considerably to 7.34%. It had touched a 10-year high of 11.64% in the beginning of the year. Prices of food articles for the week ended March 7 touched the lowest since the beginning of the year.
The sharp fall in annual inflation as measured by fuel index was due to fall in prices of jet fuel and electricity for agriculture each of which fell by 8%. The fuel prices are currently witnessing negative inflation to the range of 6% and are expected to dip further into negative territory. Now we have a high chance of a negative inflation called deflation.
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