Inflation crosses 6 per cent, seen steadying

The rate has more than tripled since mid-February this year when it was 2.08 per cent and has seen only one fall, in a week in April, since then. quot;Even though there has been a rise in recent months, the rate should stabilise and I see it staying around six percent,quot; said M R Madhavan, analyst at ICICI Securities and Finance Co.

quot;This is mainly because inflation for the manufacturing group, which accounts for over 60 percent of the index, is still low,quot; he said.

Within the WPI, the index for the food articles group rose to 172.3 points in the week to May 6 from 171.9 while for the energy group it rose to 193.6 from 192.2. For the manufactured products group, the index declined to 149.7 from 149.9.

Analysts say the rise in the energy group index reflects asharp increase in prices of kerosene and liquefied petroleum gas LPG, effected by the government in March to keep track with higher global prices.

The rise in the index for food articles group has been due to both an increase in government administered prices and short supply of some items, they say. Analysts say they are keeping a sharp watch out for themonsoon, which will determine future trends in the inflation rate. With a drought currently ravaging five states, any shortfall in rains will affect farm sector output and push up prices, they say.