Retail inflation slowed to a four-month low to 5.22 percent in December from 5.48 percent in November, mainly due to easing food basket prices, according to government data released Monday.
According to CPI data released by the National Statistics Office (NSO), food sector inflation was reduced to 8.39 percent in December. It was 9.04 percent in November and 9.53 percent in December 2023.
“CPI (general) and food inflation in December 2024 is the lowest in the last four months,” the ONS said.
Inflation based on the Consumer Price Index (CPI) was 5.48 percent in November and 5.69 percent in December 2023.
Last month, the Reserve Bank of India raised its inflation forecast for the current fiscal year to 4.8% from 4.5%. He also said continued food price pressures were expected to keep headline inflation high in the December quarter.
Headline inflation based on the CPI increased from an average of 3.6% in July-August to 5.5% in September, then to 6.2% in October 2024.
The housing inflation rate for December 2024 on an annual basis stood at 2.71 percent. The corresponding inflation rate for the month of November 2024 was 2.87 percent. The housing index is compiled for the urban sector only, according to an official release.
During the month of December 2024, a significant decline in inflation was observed in vegetables, pulses and products, sugar and confectionery, personal care and effects, cereals and products, etc., the statement added .
The latest retail inflation figure is within the Reserve Bank of India’s (RBI) medium-term target of 2-6 per cent.
Food inflation, a persistent challenge, increased by 8.39 percent annually in December, compared to a rise of 9.04 percent in the previous month and 9.53 percent last year. Food inflation increased by 10.87 percent in October, 9.24 percent in September and 5.66 percent in August.
India’s retail inflation rose to a 14-month high of 6.2 percent in October, while food inflation hit a 15-month high of 10.9 percent.
Food prices have kept inflation high in recent months, largely driven by a sustained rise in vegetable prices, which have risen mostly by double digits over the past year.
Rural inflation declined to 5.76 percent from 9.10 percent in November, while urban inflation slowed to 4.58 percent from 8.74 percent in the previous month.
In December, the RBI’s Monetary Policy Committee (MPC) lowered its growth forecast for this fiscal year from 7.2 percent to 6.6 percent, while increasing its inflation estimates to 4.8 percent. cent compared to 4.5 percent for the same period, highlighting concerns over food inflation.
