"Inflation is expected to shoot up to over 6 per cent, but the next twomonths are highly critical as traders are watching and any let-up in themonsoon clouds will lead to price hikes," said BB Bhatacharya, a leadingeconomist with Institute of Economic Growth (IEG).

The latest inflation rate for IW is 0.71 percentage points higher whencompared to that of the previous month which stood at 4.83 per cent, as perthe all-india consumer price index (CPI).

If seen at the disaggregated level, the all-india consumer price index (base1982=100) has shown a rise by four points to stand at 438 points for thelatest recorded period. Comparatively, it stood at 434 for the previousmonth this year.

"Normal monsoons is good news, but I think the inflation would continue torise and peak at 7 per cent before it starts receding," said KN Memani,chairman, Ernst and Young Pvt Ltd.

In a similar vein, Bibek Debroy, economist with the Rajiv Gandhi Foundationdiscounts any let dwon in the upward spiral of the CPI-based point-to-pointannual rate of inflation." The exact effect of the normal monsoons is yet toknown but the annualised CPI-based inflation rate would touch 7 to 7.5 percent," said Debroy.

Out of the all India centres that report for the CPI-based annual rate ofinflation for IW there was change ranging from one to 17 points waswitnessed in the case of 53 centres; while five centres recorded no changeand as many as 12 centres recorded decrease of one to seven points whencompared to that of the previous month.

The CPI-based annual inflation rate as per the consumer price index forindustrial workers (CPI-IW) has been on an upward trend since the beginningof the current calender year."The WPI-based inflation is also driving up theupward spiral of the CPI-based inflation for sometime now," saidBhattacharya.

Wih this, experts unanimously agree that even as the wholesalel price indexbased inflation rate has tended to push up the CPI-based inflation but thereverse is quite untrue. Says Bhattacharya: "The fall in the WPI-basedinflation would not per se affect the rise in the CPI-based annual inflationrates."

As per the central labour ministry data, the CPI-based inflation forindustrial workers rose to 4.83 per cent for the period March. This is over1.2 percentage points higher than the inflation based on CPI-IW for theprevious month, February, when it stood at 3.61 per cent.

The CPI-IW, which captures prices at six metros had shown the highest risein the index for Delhi for the previous period March. The other cities thathad witnessed a rise in the index were Ahemdabad, Calcutta and Chennai inthe month of March.