Food inflation at 7.58%,no change in fuel index.

India food inflation for the week ended July 9 came in at 7.58 per cent as against 8.31 per cent the previous week while the fuel price index remained unchanged at 11.89 per cent. The primary articles price index was up 11.13 percent, compared with an annual rise of 11.58 percent a week earlier.

The Reserve Bank of India has been frequently hiking interest rates in an effort to curb inflation and is expected to raise rates by another 25 basis points in its monetary review next week. The central bank has spiked its key rates a record 10 times since March 2010 whereby it has pushed up the short-term lending (repo) and reverse repo or borrowing rates by a massive 275 basis points.

The Indian Bank's Association in its meeting with the RBI Deputy Governor had urged the central bank to pause in its interest rate hike as it would retard India's economic growth.

The wholesale price inflation quickened in June to an annual 9.44 percent from 9.06 percent in May, driven by higher prices of manufactured goods and fuel, even though the economy showed signs of cooling.

The Congress-led coalition government also raised diesel prices by around nine percent at the end of June for the first time in a year, far below the near 36 per cent gain seen in international prices over the same period, but enough to rouse public protest contributing further to India's inflation

However, the government is now expected to pause in its price hike or even announce deregulation of diesel prices this year, as concerns over inflation and state elections eclipse the need to cut spending and keep pace with global oil prices.