Tuesday, 29 November 2022

Retail inflation spikes to 5.59% in December

Retail inflation spikes to 5.59% in December

CPI Inflation of India, IIP Growth Rate: The country's retail inflation, measured by the (CPI), rose to a five-month high of 5.59 percent in December. Apart, India's factory output, measured in terms of the IIP, witnessed a growth of 1.4 percent in November. Two separate figures released by the Ministry of Statistics & Programme Implementation (MoSPI) showed on Wednesday.

The inflation rate of retail for November was 4.91 percent.

The CPI data of December has come within the Reserve Bank of India's (RBI) upper margin of 6 percent. The govt has mandated the central bank to continue retail inflation at Four percent with a two percent margin on either side for five years ending March 2026.

The RBI mainly factored in the CPI data while making its bi-monthly monetary policy. The previous month, the central bank's Monetary Policy Committee (MPC) kept the repo rate unchanged for the ninth time in a Consecutive at Four percent while maintaining an 'accommodative stance' as long as necessary.

In the last meeting, RBI maintained the projected CPI inflation at 5.3 percent during the ongoing financial year 2021-22. It estimated CPI inflation at 5.7 percent in Q4, broadly balanced risks.

The Consumer Food Price Index, or inflation in the food basket, also spiked on-month during December to 4.05 percent, from 1.87 percent in November, the data revealed.

The spike in the food basket was due to a sharp rise in prices of oils and fats, which climbed 24.32 percent on year in December. Apart from this, the meat and fish prices saw an increase of 4.58 percent, while that milk and milk products gained 3.76 percent and pulses and products rose 2.43 percent. The vegetable segment slipped (-)2.99 percent; however, fruits grew 3.54 percent.

Separately from food and beverages, the fuel and light segment rose 10.95 percent, clothing and footwear gained 8.30 percent, and the housing segment inched up 3.61 percent.

Retail inflation spikes to 5.59 in December 1unsplash image

Read More: Major edible oil companies cut MRP by 10-15% to give relief to consumers, said SEA

Industrial output (IIP)

India's factory output, measured in terms of IIP, witnessed a growth of 1.4 percent on-year to 128.5 during November, separate data released by the MoSPI showed.

THE DATA SHOWED THAT the IIP had slipped 1.6 percent in November 2020.

The data showed that the industrial growth so far in the fiscal year 2021-22 (April-November) has surged 17.4 percent, compared to a contraction of (-)15.3 percent rise in the corresponding period a year ago.

The growth in IIP data during November is primarily on account of the mining sectors, which rose 5.0 percent on-year to 111.9 in November. It was followed by the electricity sector that witnessed a growth of 2.1 percent to 147.9. The manufacturing industry saw a 0.9 percent growth to 129.6, the MoSPI data showed.

In November last year, the manufacturing sector had witnessed a contraction of (-)1.6 percent. During the same duration, the mining sector had fallen (-)5.4 percent, while the electricity sector was the only one that had witnessed a growth of 3.5 percent, the data showed.

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