In November, Retail inflation eased below 6% for the first time in 2022: India’s retail inflation has decreased from 6.77% in October to 5.88% in November 2022. It is the first time in this Financial Year when the inflation rate came within the tolerance band of RBI i.e. 2 to 6%. Food prices, which account for nearly 40% of the CPI basket, eased to 4.67% in November, compared with 7.01% in October.
December 2022 Current Affairs Quiz
Since January, retail inflation has exceeded the Reserve Bank of India’s 2%–6% tolerance band, resulting in a 225 basis point increase in interest rates, bringing the rate to 6.25% as of this writing. Excluding the volatile food and energy components, the core inflation is estimated to be between 6% and 6.26% in November, Compared to 5.9% to 6.3% in October, three economists’ estimates for this month’s GDP.
RBI recently wrote a letter to the government explaining the reasons for failing to contain inflation within the set band for three successive quarters. The letter has not been made public so far. India’s retail inflation decreased to 5.88% in November from 6.77% in October due to falling vegetable and edible oil prices. This is the first time since January of this year that consumer price growth has been slower than the 6% tolerance level established by the central bank.
Consumer food price inflation eased to an 11-month low of 4.67% from above 7% in October, but rural consumers still had to bear a heavier burden with a 5.2% price increase in food items compared to their urban counterparts’ 3.7% increase. Overall rural retail inflation also stayed high at 6.09%.
