Friday, September 16 2005 15:53 Hrs (IST) - World Time -

New Delhi: Inflation appears to have ended the downward march as it rose marginally to 3.16 per cent in the week ended September 3, even as the impact of petrol and diesel price rise is yet to be felt on general price level.

Finance Minister P Chidambaram admitted that domestic fuel price hike will have 'moderate' impact on inflation, but his Chief Economic Advisor Ashok Lahiri stuck to the earlier forecast of an average 5-5.5 per cent inflation in 2005-06.

However, private research bodies Crisil and IEG have started revising upwards, their inflation forecast. While IEG expects inflation to go up to 3.9 per cent in two months, Crisil expects the average price level to be 6 per cent this fiscal.

Economists say government will not be able to hold back the adverse impact of spiraling global crude prices that touched 70 US dollar a barrel recently and is still ruling high on concerns about damage to US crude production due to Hurricane Katrina.

Though the impact of petrol and diesel price hike of September 6 on inflation is yet to be seen, seasonal factors have pushed up prices of fruits, vegetables and commercial farm products.

Among vegetables, onion prices have doubled in recent weeks in some parts of the country, which may have some impact on inflation based on Consumer Price Index and not much on Wholesale Price Index (WPI), which stood at 195.7 points.

Costlier cement and fuels like naphtha, furnace oil and aviation turbine fuel pushed up the inflation.

The Government revised inflation figure to 4.46 per cent for week ended July 9 from provisional 4.14 per cent, while the WPI stood corrected at 194.5 points as against earlier estimate of 193.9 points.