India's retail inflation in December stood at 7.35%
Reportedly India’s retail inflation in december stood at 7.35%, again led by rising food prices and this is up from 5.54% in november and 4.62% in october, as per data released by the Central Statistics office (CSO). However, core inflation stood at 3.7%. Meanwhile this is the highest retail inflation recorded in india after five years. Retail inflation in May 2014 was 8.33%.
Reportedly with this, the Consumer Price Index (CPI) has breached the RBI’s target band. Furthermore the bank OF INDIA’ target=’_blank’ title=’rbi-Latest Updates, Photos, Videos are a click away, CLICK NOW’>rbi is mandated to keep inflation between 2-6%, with a margin of 2% on either side.Perhaps with prices of onions and garlic among others soaring to record highs, vegetables recorded an inflation rate of 60.50% in december , as against a price increase of 35.99% in November. Pulses and products recorded an inflation of 15.44% in december , against 13.94% in November. As per report prices of meat and fish increased by 9.5% as against 9.38% in November. Prices of eggs increased by 8.7%, and prices of food and beverages overall increased by 12.16%.
Moreover the data assumes significance as the Reserve bank , in its latest monetary policy review , maintained key lending rates on account of rising retail inflation. Perhaps November’s retail inflation of 5.54% was reportedly the highest in 40 months. In July 2016, retail inflation was at 6.07%. Also nirmala sitharaman is set to present the budget on february 1, and the RBI’s next monetary policy meet is on february 6, where it will take a decision on an interest rate cut. Hence this also comes at a time when India’s GDP growth has been forecasted to dip to an 11-year low of 5% in the current fiscal, primarily due to poor showing by the manufacturing and construction sectors.