Page last updated at 08:23 GMT, Thursday, 18 June 2009 09:23 UK

Indian inflation turns negative

New Delhi market
Food prices have been falling in India

Inflation in India has turned negative for the first time in more than 30 years, official figures have shown.

Wholesale prices fell 1.61% in the year to 6 June, compared with a rise of 0.13% the previous week, the Ministry of Commerce and Industry said.

Cheaper food prices dragged the index down, and analysts said prices could continue falling for about four months.

It marks the first annual decline in wholesale prices since the government started releasing weekly data in 1977.

"We will have negative numbers at least till September, primarily because inflation had picked up very sharply during this period last year," said Sonal Verma, an economist at Nomura.

Inflation hit a 13-year high of 12.9% in August 2008, but has been decelerating steadily since.

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