A steep rise in energy sector prices has increased the wholesale price index-based inflation during June 2008, an economic think-tank said.

"The WPI-based inflation rate rose to 10.7 per cent for June this year from 7.5 per cent during first two months of the current fiscal," the National Council of Applied Economic Research said in its report in Mumbai.

"The increase by more than three per cent is largely due to jump in the rate of inflation in the case of WPI for fuel, power, light and lubricants -- by more than double," the NCAER report added.

• Inflation, the silent killer

The prices of petrol, diesel and LPG were hiked in June 2008 when the sharp rise in imported crude oil prices became too high to be absorbed through tax or subsidy measures.

There was an increase in year-on-year rate of price rise in the case of primary articles as well as manufactured products, but the rise was the sharpest in the case of energy sector, NCAER said.

The rise in prices in recent months has not been limited to India.

Prices have also shot up all over the developed world and in major developing countries, the report said.