January 4, 2010 3:29 PM

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Food inflation to ease in next month: Montek

The Planning Commission has said food inflation will come down next month from a decade's high of around 20 per cent. Speaking on the sidelines of a FICCI function in New Delhi on Monday, Planning Commission Deputy Chairman Montek Singh Ahluwalia said that with the fear of negative impact of drought being reduced, there will be a softening in food price inflation in the next month. Mr Ahluwalia said that inflation at the moment was not caused by excess money supply but was dominantly on account of surge in food prices. Following widespread drought and floods in various parts of the country, food inflation climbed to more than a 10-year high of 19.95 per cent in December, driven mainly by higher prices of potato, other vegetables and pulses. According to latest figures, food inflation stood at 19.83 per cent during the third week of December.

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