NEW DELHI, March 20: India’s inflation rate jumped by almost a full percentage point to hit a more than 10-month high this month, data showed on Thursday, dashing hopes of a swift interest rate cut to spur a slowing economy.

Annual inflation accelerated by 0.81 percentage points to 5.92 per cent for the week ended March 8 from 5.11 per cent the previous week, according to the wholesale price index, India’s most watched cost-of-living monitor.

The leap was driven by increases in prices of essential goods such as cooking oils, pulses, fruit, vegetables and spices and was bad tidings for the Congress-led government, which largely owes its 2004 national election win to support from India’s poor masses, who have been hardest hit by inflation.

The latest figure “completely rules out the chances of a near-term rate reduction from the central bank despite the slowing economy,” said HSBC economist Robert Prior-Wandesforde.

The government’s focus now would be fixed on battling inflation “given the huge political sensitivity to rising prices in India,” he said.

The new rate came despite aggressive monetary tightening and far exceeded market forecasts of around 5.20 per cent. The level was the highest since late April 2007 when inflation stood at 6.01 per cent and is way above the central bank’s five per cent tolerance level.

The data came a day after the government imposed a ban on the export of cooking oils to curb rising prices. Commerce Minister Kamal Nath said the government might soon cut duties on palm oil imports to help in the inflation fight.—AFP