Finance Minister expresses 'concern', as Inflation surges to 8.1%

Despite the government claims of effective measures to curb the rising inflation rate and skyrocketing food prices, the inflation crossed the psychological barrier of 8 percent to end at 8.1% during the week ending May 17. Earlier, it was pegged at 7.82%. While the fruits and vegetable prices rose by 3 percent, marine products rose by 6 percent. The food prices went up by 0.6 percent. The Finance Minister said that necessary measures will be taken to control the rising inflation if necessary.

For the first time, Mr. Chidambaram admitted that 8.1% inflation rate is "worrisome". Even the government is not sure if it would be able to maintain the estimated GDP growth under the current circumstances. The rising inflation has been attributed to increase in global food and fuel prices. There is no doubt that market is witnessing a slowdown and many sectors are worst affected.