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Retail Inflation Data : Good news is coming out on the inflation front in the country. Retail Inflation has decreased in October as compared to September. In the month of October, the retail inflation rate has come down to the lowest level of 3 months at 6.77 percent. However, it is less than the 5-month high of 7.41 per cent in September.
relief in wholesale inflation
At the same time, there has been a big relief on the wholesale inflation front. The commerce ministry presented the wholesale inflation data. In this, in the last 19 months, there has been a big decline in wholesale inflation and it has reached single digit. According to the data, the inflation rate based on Wholesale Price Index has come down to 8.39 percent in the month of October. It was at 10.7 per cent in September. Wholesale inflation was in double digits in September, but has come down to single digits in October.
this is the reason
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According to the retail inflation data released on Monday, this decline has come due to softening in the prices of food items. Despite this decline, the retail inflation rate in October remained above the RBI’s target band of 2 to 6 percent. Every month this year the inflation rate has remained above the band of RBI. According to sources, disruptions were also seen in the supply chain, behind which geopolitical reasons and increase in commodity prices are believed to be the reason. This increased the pressure on inflation. At the same time, the inflation of food items for October has been 7.01 percent, which was present at 8.6 percent in the previous month.
What has been RBI’s repo rate
The Reserve Bank of India (RBI) takes retail inflation as a barometer for announcing its policy rates. It is estimated that it may remain less than 7 percent. On the basis of this retail inflation rate, the Reserve Bank announces the repo rate. From May to September, the Reserve Bank has increased the repo rate by 1.90 basis points. Right now the repo rate is 5.90 percent which is based on the retail inflation rate. The increase in the repo rate is being seen because retail inflation is running above the Reserve Bank’s tolerance rate of 6 percent.
What is CPI based inflation?
Inflation based on the Consumer Price Index (CPI) tracks changes in the retail prices of goods and services that households buy for their daily use. To measure inflation, it is estimated by what percentage has the CPI increased during the same period last year.
Rural, urban figures are ready
RBI looks at this figure to keep the prices stable in the country’s economy. The retail prices for a particular commodity can be seen in CPI. These are seen at the level of rural, urban and all India. The change in price index within a period of time is also called CPI based inflation or retail inflation.
7.41 per cent in September
In the month of September, the retail inflation rate has increased to 7.41 percent. Retail inflation stood at 7 per cent in August and 6.71 per cent in July. A year ago, in September 2021, the retail inflation rate was 4.35 percent. There has also been a jump in the inflation rate of food items. Food inflation has reached 8.60 percent in the month of September, which was 7.62 percent in August. In the month of September, there has been a jump in food inflation in both urban and rural areas.
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