RBI Policy: Retail inflation eases to 3-month low of 6.77% in October
Retail inflation eased to a three-month low of 6.77 per cent in October from a five-month high of 7.41 per cent in September, on the back of weaker food price increases and a stronger year-on-year basis, as That is shown in official statistics. monday.
data released by Office for National Statistics showed consumer price based inflationRetail inflation, or retail, remains above the upper band of the Reserve Bank of India’s 2-6 per cent target for each month this year.
India’s central bank primarily looks at retail inflation to formulate monetary policy, and any cooling off in price pressures is a positive sign for the RBI which is fighting high inflation and looking to stimulate the economy simultaneously. is trying.
The RBI has raised its key interest rate four times this year to 5.90 per cent – the highest since April 2019.
This lower price is under pressure to read in line with RBI Governor Shaktikanta Das’s assessment on Saturday that retail inflation could dip from 7 per cent in October to below 7.41 per cent in September.
According to Mr. Das speaking at the HT Leadership Summit in New Delhi, inflation is a significant concern for India. He said the central bank and the government have effectively taken a number of steps to address this over the past several months.
Yet, the RBI has failed to manage price growth under the flexible inflation targeting framework implemented in 2016, as CPI-based inflation has remained above the 2-6 per cent range for three consecutive quarters.
On November 3, RBI’s Monetary Policy Committee (MPC), convened for the first time since the monetary policy framework came into effect nearly six years ago, held an out-of-sequence meeting to discuss and prepare a report to the government on inflation. for failing to uphold the mandate.
The public has not yet been given access to much information about the convention.
According to a separate report, Morgan Stanley expects India’s retail inflation to track within the RBI’s target band by March 2023.
Further breakdown of the latest data showed rural inflation for the fifth consecutive month above urban price pressures.
Earlier in the day, the data showed a decline for the fifth month in a row, Wholesale price-based inflation fell to 8.39 per cent in October from a year ago, the lowest since March 2021 and below double-digit growth for the first time in 18 months.