NSO Data: Retail Inflation Hits 10-month Low of 4.85%

Retail inflation hit a 10-month low of 4.85% in March from 5.09% in the previous month, due to controlled food prices and lower petrol, diesel, and LPG prices, according to data released by the National Statistics Office (NSO), Ministry of Statistics and Program Implementation on Friday. 

With rural areas showing a consistently higher food inflation increase than urban areas, the Consumer Food Price Index-based inflation has continued to remain above 8% for the fifth month, while easing to 8.52% in March from 8.66% earlier.

Rural Food Inflation Remains High

The Consumer Price Index (CPI) data indicated that urban food inflation eased to 8.35% in March from 9.19% in February, yet remained significantly elevated compared to 4.82% in March 2023. Meanwhile, rural food inflation rose to 8.61% in March from 8.27% in February and surged from 4.72% in the same period last year.

Last week, Reserve Bank of India (RBI) Governor Shaktikanta Das said that, with the current heatwave conditions, food price volatility remains a concern alongside the ongoing upside trend in international crude oil prices.

Inflation Rate for Food and Beverages Slip

The headline retail inflation rate, based on CPI (Combined), eased below 5% in March after remaining above the level for four consecutive months. In March, the inflation rate for the food and beverages segment, which holds a weightage of 45.86% in the CPI, decreased to 7.68% from 7.76% in February. 

Notably, vegetable inflation saw a slight decrease to 28.34% from 30.25% in February, while the inflation rate for pulses eased to 17.71% from 18.90%. Contrarily, cereals and products inflation, after seven months of decline, reversed its trend to increase to 8.37% in March from 7.60% in February.

The Index of Industrial Production (IIP) data released by the NSO shows a four-month high of 5.7% in February, higher from 4.1% the previous month, though lower than the previous year’s 6%.