Retail inflation in India declined to 5.10 per cent in January due to an easing in food prices, according to the data released by the government on Monday.
Inflation based on the Consumer Price Index (CPI) was 5.69 per cent in December last year. It was 6.52 per cent in January 2023.
National Statistical Office (NSO), Ministry of Statistics and Programme Implementation (MoSPI) released the All India Consumer Price Index (CPI) on Base 2012=100 and corresponding Consumer Food Price Index (CFPI) for Rural (R), Urban (U) and Combined (C) for January 2024 (Provisional).
The price data is collected from selected 1114 urban Markets and 1181 villages covering all states or UTs through personal visits by field staff of the Field Operations Division of NSO, MoSPI on a weekly roster.
During January 2024, NSO collected prices from 99.8 per cent of villages and 98.5 per cent of urban markets while the market-wise prices reported were 89.9 per cent for rural and 93.6 per cent for urban.
In terms of year-on-year inflation rates, the CPI (General) for rural areas stood at 5.34 per cent, while for urban areas, it was 4.92 per cent, resulting in a combined rate of 5.10 per cent for January 2024.
Consumer Food Price Index (CFPI) recorded year-on-year inflation rates of 7.91 per cent for rural areas, 9.02 per cent for urban areas, and 8.30 per cent combined.
The monthly changes in the CPI (General) and CFPI for January 2024 over December 2023 showed a marginal decrease of -0.16 per cent for rural areas, -0.05 per cent for urban areas, and -0.11 per cent combined.
CFPI witnessed a more significant decline of -0.74 per cent for rural areas, -0.77 per cent for urban areas, and -0.73 per cent combined.
Chief Economist at Kotak Mahindra Bank, Upasna Bhardwaj said, “CPI inflation came in slightly softer than our expectations led by moderation in food prices. Positively though, core inflation softened in line with our expectations. We see some uptick in high-frequency mandi vegetable prices but moderation in cereal prices. The supply-side intervention should continue to provide respite in the food prices. However, uncertainties in food inflation outlook should keep RBI cautious in the near term, with much action by the RBI expected on the liquidity front.”
