Food inflation declined to 12.30 per cent for the week ended October 30, on improved supply of items, showing a downward movement for the fourth straight week.It was 12.85 per cent in the previous week.
While most food items like wheat, pulses and potatoes turned cheaper, onions became costlier as their prices rose about 10 per cent within a week.
Considering that food inflation stood at a high of 12.59 per cent during the corresponding week of last year, even 12.30 per cent inflation is quite elevated.
Earlier this month, RBI raised its short-term rates to tame inflation saying prices of protein based food
items are still high.
However, Prime Minister's advisory panel believes that food inflation could be tamed through improved production.
At a function, Prime Minister's Economic Advisory Council chairman C Rangarajan said, "Food inflation is caused by shortage of food and supply. In the mid-term we need to ensure that supply is increased through production to curb inflation."
