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India’s retail inflation jumps to six-month high of 5.59% in December

13 Jan 2022 Evaluate

With rising prices of essential kitchen items, the India’s retail inflation jumped to a six-month high of 5.59 per cent in December 2021, close to the Reserve Bank of India’s (RBI’s) upper tolerance limit of 6 per cent. The Consumer Price Index (CPI) based retail inflation was 4.91 per cent in November 2021 and 4.59 per cent in December 2020. The RBI, which mainly factors in the CPI-based retail inflation while arriving at its bi-monthly monetary policy, has been tasked by the government to keep the inflation at 4 per cent with margin of 2 per cent on either side (that is, in the range of 2-6 per cent).

The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that the Rural CPI (General) in December 2021 stood at 5.36 per cent as against 4.29 per cent in November. The Urban CPI (General) stood at 5.83 per cent in December as against 5.54 per cent in November. The index value for Rural, Urban and Combined CPI (General) stood at 167.0, 165.1 and 166.1 respectively, in December 2021.

As per the data released by the NSO, food inflation was at 4.05 per cent in December this fiscal compared to 1.87 per cent in the preceding month. In the food basket, inflation was on higher side in ‘cereals and products’, eggs, ‘milk and products’, spices, and ‘prepared meals, snacks and sweets’ segments in December over the preceding month. However, the rate of price rise was slower in case of vegetables, fruits, and ‘oil and fats’. In the ‘fuel and light’ category, though the inflation softened from a month ago, it remained elevated at 10.95 per cent during the month. It was 13.35 per cent in November 2021.

The Price data are collected from selected 1114 urban Markets and 1181 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 2021, NSO collected prices from 99.7% villages and 98.5% urban Markets while the Market-wise prices reported therein were 89.6% for rural and 93.3% for urban.

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