Retail inflation dips marginally to 6.44% in Feb on easing prices of food, fuel
- The inflation rate for the food basket was 5.95% in February, lower than 6% in January, as per the government data
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Business News/ Economy / Retail inflation dips marginally to 6.44% in Feb on easing prices of food, fuel
NEW DELHI :Retail inflation dipped marginally to 6.44% in February, mainly on account of a slight easing in prices of food and fuel items, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Monday.
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The inflation rate based on the Consumer Price Index (CPI) stood at 6.52% in January and 6.07% in February 2022.
The inflation rate for the food basket was 5.95% in February, lower than 6% in January, as per the government data. The food basket has weightage of 39.06% in the overall Consumer Price Index.
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Except for November and December 2022, retail inflation has remained above the RBI’s upper tolerance level of 6 per cent since January 2022.
The RBI in the policy meet last week cut inflation projection 2022-23 to 6.5% from 6.7% estimated earlier, even as central bank governor Shaktikanta Das cautioned about the elevated core inflation.
The central bank has been mandated by the government to ensure the retail inflation remains at 4 per cent with a margin of 2 per cent on either side.
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To contain the rising prices, the RBI has hiked interest rates by 250 basis points since May last year. The RBI led monetary policy committee on 8 February hiked the repo rate for the sixth time by a smaller 25 basis points (bps) to 6.5%.
“Food products are up by 6.3% driven by cereals with 16.7%. The prevailing heat wave has cast a shadow on the prospects of wheat crop and we may expect shortfall which will further exacerbate inflation," Madan Sabnavis, chief economist at Bank of Baroda, said.
“Clothing and footwear inflation at 8.8% is driven by higher cost of cotton as well as power which has pushed up prices," he added.
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