The current phase of inflation in India is driven by increase in prices of a few commodities such as sugar, oil cakes, food grains, eggs, meat, fish and drugs and medicines, the Reserve Bank said on Thursday.
Since the above commodities have a combined weight of 14.8 per cent in overall wholesale price index (WPI), it explains a significant part of the inflation during recent months, the RBI said in its Third Quarter Review of Macroeconomic and Monetary Developments for this fiscal (FY 10).
However, the contribution of these key drivers has come down in December 2009, indicating early signs of inflation getting generalised, the apex bank said.
Commodities with zero or negative inflation, however, had an aggregate weight of 50.7 per cent in the WPI, it said.
In terms of contribution to overall inflation by the major groups, primary articles group continues to drive the overall WPI inflation, besides the manufactured food products.
"The contribution of non-food manufactured products group, which waned during the declining phase of inflation, has also started to increase in recent months," the RBI said.
On the fuel group, it said that its contribution which was significantly negative since January 2009, has now shown a reversal of trend in recent months "and now contributes positively to overall inflation."
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