NEW DELHI: How much is the current rate of inflation in the country?
Going by the official date on wholesale price index the rate of inflation for the 52 weeks ending August 17 is 14.6%. However this appears to be an attempt to play down the real magnitude of inflation which should be between 16 to 17%.
The method of computing the annual rate of inflation usually adopted by the officials is to compare the latest available provisional data with those of the final data a year ago. Invariably the Government’s provisional data is on the lower side and its comparison with the final figure a year ago distorts the real picture about the price behavior. This helps the Government to project the inflation at lower rate.
A more realistic approach would be the comparison between the provisional figures at the two points of time. By this method the annual rate of inflation ending Aug.17 should be 15.2%. Even this is likely to be far below the real rate of inflation. A correct picture will emerge in eight weeks when the Government puts out the final data.
The latest available final data relates to the week ending June 22.
Article extracted from this publication >> September 20, 1991
