CPI jumps 4.62 per cent in October, breaches RBI medium-term target of 4 per cent

Breaching the Reserve Bank of India's (RBI) medium-term target of 4 per cent for the first time since July 2018, India’s retail inflation based on Consumer Price Index (CPI) quickened to 16-month high of 4.62 per cent in October from 3.99 per cent in September 2019 on the back of higher food prices. This is the third straight month of rise in CPI. The earlier high was reported in June 2018 when the retail inflation print was recorded at 4.92 per cent. The inflation in the food basket spiked to 7.89 per cent in October 2019 against 5.11 per cent the previous month, mostly due to the surge in vegetable prices.

As per the data of the Central Statistics Office (CSO), the Ministry of Statistics and Programme, the CPI (Rural, Urban, Combined) on base 2012=100 for October 2019, stood at 4.29%, 5.11 per cent, and 4.62 per cent, respectively, while in October 2018, they stood at 2.82 per cent, 4.04 per cent, and 3.38 per cent, respectively. The index value of CPI combinedly stood at 147.2. The data also showed that consumer food price index (CFPI) for all India Rural and Urban stood at 6.42 per cent and 10.47 per cent, respectively, for October 2019 against -0.65 per cent and -1.15 per cent, respectively, in October 2018. The index value of CFPI, combinedly, stood at 149.1 for the month of October.

Besides, inflation in vegetables spiked to 26.10 per cent from 5.40 per cent in September while for fruits, it jumped 4.08 per cent from 0.83 per cent. Likewise, the prices of cereals, meat and fish, and eggs grew at a faster pace of 2.16 per cent, 9.75 per cent, and 6.26 per cent, respectively. For pulses and related products, the retail inflation rose to 11.72 per cent. However, the prices of the fuel and light category continued to witness a downward move at (-) 2.02 per cent as against (-) 2.18 per cent, a month earlier. Meanwhile, inflation in the housing sector stood at 4.58 per cent for October, while it was 1.65 per cent in the clothing and footwear sector.