Retail inflation falls to 15-month low of 5.66% in March; back to RBI’s comfort level

13 Apr 2023 Evaluate

In line with easing prices of vegetables and protein-rich items, retail inflation based on Consumer Price Index (CPI) fell to a 15-month low of 5.66 per cent in March 2023 and came back to the Reserve Bank of India’s (RBI’s) comfort level of 6 per cent. The CPI was 6.44 per cent in February 2023 and 6.95 per cent in the year-ago period. The previous low was also 5.66 in December 2021. The Reserve Bank has been mandated by the government to ensure inflation remains within the 4-6 per cent bracket. The CPI was above 6 per cent in January and February.

The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that Rural CPI (General) in March 2023 stood at 5.51 per cent as against 6.72 per cent in February. The Urban CPI (General) stood at 5.89 per cent in March as against 6.10 per cent in February. The index value for Rural, Urban and Combined CPI (General) stood at 178.0, 176.3 and 177.2 respectively, in March 2023.

The overall inflation in the food basket was 4.79 per cent in March against 5.95 per cent in February and 7.68 per cent in the year-ago period. The food basket has a weightage of 54.18 per cent in the overall CPI. The year-on-year inflation declined in the vegetable basket by 8.51 per cent, oil and fats by 7.86 per cent and meat and fish by 1.42 per cent in March. However, the rate of price rise in spices was high at 18.2 per cent in March, followed by ‘cereals and products’ by 15.27 per cent. Fruits too were expensive.

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