NEW DELHI: Retail inflation soared to a 17-month high of 6.95% in March with the prices of most commodities soaring, data published by the National Statistical Office showed on Tuesday. It is the third straight month when the inflation remained above the Reserve Bank of India’s comfort zone of 6%. Retail inflation, measured by Consumer Price Index (CPI), was 6.07% in February and 6.01% in January. The CPI inflation was 5.52% in March 2021.
The surge in March retail inflation was driven mainly by costly food items, which registered a 7.7% growth compared to 5.9% in February. Vegetables prices rose 11.6%, edible oils 18.8%, meat and fish by 9.6% and cereals by 4.9% during the month under review.
Inflation in the ‘fuel and light’ category, however, grew at a slower pace of 7.5% in March (compared to 8.7% in February) as most of the price hikes in petrol, diesel and LPG happened in the later part of the month.
According to the latest data, the prices of most commodity groups touched multi-month highs — cereals and products (19 months), milk and products (16 months), vegetable (16 months), clothing (100 months), footwear (111 months), household goods and services (102 months), personal care (13 months) and food index (16 months).
Core inflation, or non-food non-fuel inflation, was at 6.4% in March compared to 5.8% in February. Core inflation is likely to see a broad-based rise as producers pass on cost pressures across segments, says rating agency Crisil. The poor are bearing the burden of inflation the most, given that food recorded the sharpest rise, Crisil adds.
Meanwhile, rural inflation showed a higher jump of 7.7% than urban inflation (6.12%). RBI in its recent monetary policy had said that its primary focus would be to contain inflation. The central bank also revised the 2022-23 inflation estimates to 5.7% from its earlier forecast of 4.5%.