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Retail inflation surges to 5.69 percent in January

15 Feb 2016 Evaluate

Surging for the sixth straight month, the retail or the Consumer Price Index (CPI) inflation for the month of January climbed to 5.69 per cent from 5.61 percent in the month before. It has touched its 16 month high mainly due to costlier food prices, posing a challenge to further easing of monetary policy by the Reserve Bank. The pace of retail price rise in January 2016 is the highest since 6.46 percent in September 2014. Food inflation, or CFPI, during the month, ruled higher at 6.85 percent, as compared to 6.4 percent in December 2015, and at 6.14 percent in January 2015.

As per the data released by the Ministry of Statistics and Programme Implementation, Consumer Price Index numbers on Base 2012=100 for Rural, Urban and Combined for the Month of January 2016 stood at 6.48%, 4.81% and 5.69% respectively as against 6.32%, 4.73% and 5.61% in the month of December 2015. Meanwhile, Consumer Food Price Index (CFPI) for all India Rural, Urban and Combined for the month of January 2016 stood at 6.93%, 6.50% and 6.855 respectively. The General Indices (Provisional) for the month of January 2016 for Rural, Urban and Combined are 128.1, 124.2 and 126.3 respectively.  The CFPI for Rural, Urban and Combined for the same month are 131.1, 131.0 and 131.1 respectively.

Retail prices of 'cereals and products' inched up by 2.19 percent in January, from 2.12 percent in December 2015. The rate of price rise in meat and fish category was 8.23 per cent during the month, while it was 3.96 percent for eggs. The substantial price rise in these items is mainly attributed to their higher consumption during winter.

However, prices of seasonal fruits witnessed deflation during the month, with a fall of (-) 0.24 percent. But vegetable prices moved up fairly at 6.39 percent. Prices of 'pulses and its products' continued to stay elevated, as inflation was as high as 42.32 percent.

The Reserve Bank of India has set a 6 percent retail inflation target for January 2016. Presenting the first bi-monthly monetary policy statement for this fiscal in April last year, RBI Governor Raghuram Rajan had said CPI inflation would hover around 5 percent in the first half of the fiscal, and a little above 5.5 percent in the second half.


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