Retail inflation rises to 4.48% in October on increase in food and fuel prices

India's retail inflation, measured by the All India Consumer Price Index (CPI), increased to 4.48 per cent in October from 4.35 per cent in September, on the back of higher-than-expected food and fuel prices, the Ministry of Statistics and Programme Implementation data shows.

The retail inflation was way higher at 7.61 per cent during the same period last year. In August, India's retail inflation was at 5.30 per cent while it was 5.59 per cent in July.

As per the All India Consumer Price Indices, food inflation increased marginally to 0.85 per cent in October 2021 from 0.68 per cent in September 2021 but contributed nearly half of the monthly increase in headline retail inflation.

Fuel and light inflation jumped to its highest level in the new series in October 2021 at 14.3 per cent on the back of higher LPG and kerosene prices.

Food and beverage inflation rose to 1.8 per cent in October from 1.6 per cent in September on a year-on-year basis. Vegetable prices contracted by 19.4 per cent in October versus 22.5 per cent in September. Cereals prices rose after a gap of 8 months. Cereal prices rose by 0.4 per cent in October. Inflation in Oils and Fats prices continued to remain elevated, at 33.5 per cent in October.

The RBI has a tolerance level of 4 per cent (+-2 per cent) for inflation. It has projected the CPI inflation at 5.7 per cent during 2021-22 -- 5.9 per cent in the second quarter, 5.3 per cent in third quarter, and 5.8 per cent in the fourth quarter of the fiscal, with risks broadly balanced.

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