New Delhi: Inflation increased to 9.72 percent in September from 8.98 percent a year ago, raising prospects of yet another interest rate hike by Reserve Bank later this month.

Prices of almost all the items, including food and manufactured products, went up significantly.

However, the general inflation, measured by Wholesale Price Index (WPI) was marginally lower than 9.78 percent in August.

Finance Minister Pranab Mukherjee, who is in Paris for the G-20 meeting, said the September figures "are not very encourgaing... the only encouraging point is that "it has not moved up (compared with August), the decline is very low."

This is for the tenth consecutive month when the rate of price rise has stayed above 9 percent.

"If inflation goes up, interest rates will go up anywhere in the world... I have no other (monetary policy) instrument available with me (to anchor inflationary expectations)," RBI Deputy Governor K C Chakrabarty said here.

Food items became 9.23 percent expensive year-on-year in September. Onions became 23.58 percent costlier, fruit were up 15.98 percent and potatoes rose by 14.64 percent. Overall, vegetable prices witnessed 14.04 percent inflation.

Prices of manufactured products, which have a weight of around 65 percent in WPI basket, went up by 7.69 percent.

Inflation in June this year also stood revised to 9.36 percent from the provisional figure 9.22 percent, as per the data released on Friday.

"It is not a very comfortable situation. For the monetary policy stance to change, inflation has to come down and show signs of definite decline. But that kind of an indication has not come...," Chairman of the Prime Minister's Economic Advisory Council C Rangarajan said.

After raising interest by 3.50 percentage points since March, 2010 the RBI is scheduled to review the rates again on October 25.

(Agencies)