Retail inflation, calculated on the basis of Consumer Price Index (CPI), remained elevated at 6.93 per cent in November against 7.61 per cent last month. The latest data shows that the CPI inflation continues to remain above 6 per cent throughout this year -- except in March -- higher than the Reserve Bank of India's comfort zone of 4-6 per cent.
The CPI inflation had spiked to six-year high of 7.61 per cent in October on the back of rise on food prices. This was the highest level of retail inflation since May 2014 when the inflation level was at 8.33 per cent.
Inflation in food basket, or Consumer Food Price Index, eased to 9.43 per cent during the month under review, versus 11.07 per cent in October and 10.68 per cent in September, data released by the Ministry of Statistics & Programme Implementation (MoSPI) showed.
Inflation rate in vegetable prices remained high during the month as onion prices had skyrocketed due to supply crunch as rains damaged crops. Potato and tomato prices had also risen beyond the average levels.
"The price data are collected from representative and selected 1,114 urban markets and 1,181 villages covering all states/UTs through personal visits by field staff of Field Operations Division of NSO, MoSPI on a weekly roster. During the month of November 2020, NSO collected prices from 98.8 per cent villages and 98.6 per cent urban markets while the market-wise prices reported therein were 87 per cent for rural and 91.1 per cent for urban," the Ministry of Statistics & Programme Implementation (MoSPI) said.
The RBI Governor Shaktikanta Das, in its monetary policy committee (MPC) meet on December 4, pegged the CPI inflation to be 6.8 per cent during October-December quarter, adding that it is likely to come down to 5.8 per cent in Q4. The MPC has been given the mandate to maintain annual inflation at 4 per cent by March 31, 2021, with an upper tolerance of 6 per cent and a lower tolerance of 2 per cent.
Earlier in the day, the government data showed that wholesale price index (WPI) based inflation rose to nine-month high of 1.55 per cent in November as against 1.48 per cent in October. WPI inflation in October was at an eight-month high due to costlier manufactured products.
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