This is the highest inflation since November 18, 1995, when it touched 8.3 per cent.

The rate of increase in price rise, based on the Wholesale Price Index, rose by 0.49 percentage points during the week to 8.08 per cent (provisional) from 7.59 per cent in the previous week. The rate in the corresponding week last year was 4.14 per cent.

The rise is mainly on account of an increase in the price of vegetables, which have gone up by a whopping 71.48 per cent since the beginning of the current fiscal. During the year so far, the index of primary food articles as a whole has risen by 12.17 per cent. According to figures placed in parliament, prices of onion and potato in Delhi have risen by 116 per cent and 50 per cent since the presentation of the budget.

Economists suggest that the increase in inflationis not due to a pick-up in demand as prices of manufactured products have remained more or less stagnant. During the week, the official wholesale price index for `all commodities' rose by 0.5 per cent to 350.5 compared to 348.7 in the previous week.

Inflation based on the final index for the week ended May 16 stood at 6.6 per cent as against 6.4 per cent on the provisional index during the same week.

The final index for all commodities stood at 343.9 as against 343.1 on the provisional index.

In comparison, inflation based on the consumer price index for industrial workers has already peaked at 10.5 per cent in may. The comparable figure for WPI inflation was 6.4 per cent.

Among the three major groups in the index, indices of `primary articles' and `manufactured products' rose during the week, while index of fuel, power, light & lubricants declined.

Commodities, which registered substantial price rise during the week were: cotton seed oil (18 per cent), formaldehyde (14 per cent), trailors (13 percent), cotton seed (8 per cent), gingelly seed (6 per cent), fruits & vegetables (5 per cent), arhar, eggs, raw silk and pipes & tubes (4 per cent each).

The prices of sulphuric acid (7 per cent), tea, bran and raw skins (6 per cent) eased substantially during the week. During the week, the index primary articles shot up by 1.3 per cent to 377.9 from 373.2 for the last week as indices of both food and non-food articles soared.

Food articles' index rose by 1.5 per cent to 438.8 from 432.4 due to dearer fruits & vegetables (5 per cent), arhar and eggs (4 per cent each), moong, urad and poultry chicken (3 per cent each), wheat, maize, gram and masur (2 per cent each) and jowar, bajra and fish (1 per cent each).

From the subgroup, prices of tea (6 per cent), milk (2per cent) and barley, mutton and pork (1 per cent each) became cheaper during the week.The index for non-food articles rose by 1.1 per cent to373.5 from 369.6 due to increase in the prices of cotton seed (8 per cent), gingelly seed (6 per cent),raw silk (4 per cent), castor seed and fodder (2 per cent each) and rape & mustard seed and raw hides (1 per cent each). From the sub-group raw skins (6 per cent), copra (2 per cent) and raw jute (1 per cent) were cheaper.

The index for fuel, power, light & lubricants declined by 0.1 per cent to 379.9 from 380.4 in the previous week due to lower prices of naptha (3 per cent). The index for the third major group manufactured products rose by 0.2 per cent during the week to 329.5 from 328.9 for the previous week.

Under manufactured products, the index for food products rose by 0.6 per cent to 340.8 from 338.7 due to higher prices of cotton seed oil (18 per cent), ghee, atta, gur, gingelly oil, rape & mustard oil and groundnut oil (2 per cent each) and butter solvent extracted groundnut oil (1 per cent). However, from the sub-group, prices of bran (6 per cent)and suji, coconut oil, rice bran oil, oil cakes and poultry feed (1 per cent each) closed lower.

Indices for textiles and rubber and plasticproducts declined marginally during the week to 320.7 and 244.7 from 320.8 and 244.8 respectively due to cheaper shirts (2 per cent) and tyres (marginal). Tractor tyre price went up by one per cent.

The index for chemicals and chemical products was up by 0.2per cent to 275.2 from 274.6 on account of dearer formaldehyde (14 per cent), nitric acid and castor oil (3 per cent each), caustic soda and linseed oil (2 per cent each) and carbon black (1 per cent).

From the sub-group price of sulphuric acid (7 per cent) fell during the week.A 4 per cent increase in pipes and tubes saw the index for basic metals, alloys and metal products rise by 0.2 per cent from 352.9 to 353.7.In machinery and machine tools, the index rose by 0.1 per cent to 301.7 from 301.4 due to rise in prices of power driven pumps and ball bearings (1 per cent each). However, price of switchgears (1 per cent) rose during the week. The index for transport equipment & parts+ rose by 0.1 per cent to 281.2 from 281.0 due to higher prices oftrailors (13 per cent). Bicycles were cheaper by one per cent.

Indices for all other groups remained unaltered at their respective over the previous week's level.