Retail inflation in India marginally rose to 5.69 per cent for December, the highest in four months, mainly on account of higher food prices, as per the latest data released by the National Statistical Office (NSO) on Friday. The CPI inflation in November was 5.55 per cent. Though it inched up, the December inflation number has remained within the Reserve Bank of India’s (RBI’s) tolerance limit of 2-6 per cent.
The jump in inflation was mainly because of rising food prices. The inflation in food came in at 9.53 per cent in December, whereas in November it was recorded 8.7 per cent. The highest inflation was recorded in the food and beverages category at 8.70 per cent.
The RBI in its last MPC estimated the Consumer Price Index (CPI) based retail inflation to remain at 5.4 per cent in the current fiscal year. Earlier, the growth projection for FY24 was increased to 7 per cent from 6.5 per cent. Notably, the MPC meet happened against the backdrop of inflation reducing to 4.87 per cent in October, while the data for inflation in November is set to be announced next week. The government has mandated the RBI to maintain CPI inflation at 4 per cent, with a margin of 2 per cent on either side.
The price data are collected from selected 1,114 urban markets and 1,181 villages covering all states/UTs through personal visits by field staff of Field Operations Division of NSO, MoSPI on a weekly roster. During the month of December 2023, NSO collected prices from 99.9 per cent villages and 98.6 per cent urban markets while the market-wise prices reported therein were 90.0 per cent for rural and 93.7 per cent for urban.
On the other hand, IIP growth fell to 2.4 per cent in November from 11.6 per cent in October.