Retail Inflation Overview
India’s retail inflation decreased slightly to 5.5% in November from 6.2% in October, which was a 14-month high.
Rural inflation remained high at 5.95%, while urban inflation dropped to 4.8%.
Food inflation, which has been a concern for interest rate cuts, eased slightly from 10.9% in October to 9.04% in November.
Rural areas saw 9.1% food inflation, while urban areas experienced 8.74%.
Key Trends in Inflation
Vegetables: Inflation eased significantly from 42.2% in October to 29.33% in November.
Oils and Fats: Saw a sharp rise in inflation to 13.3%, the highest in 2.5 years.
Other Products:
Pulses inflation dropped to a two-year low of 5.4%.
Fruits inflation eased from 8.4% to 7.7%.
Personal care and effects inflation remained high at 10.4%.
State-Level Inflation Variations
Six states recorded inflation rates above 6%: Chhattisgarh (8.4%), Bihar (7.55%), Odisha (6.8%), Uttar Pradesh (6.6%), Kerala (6.3%), and Madhya Pradesh (6.05%).
Delhi had the lowest inflation at 2.65%, well below the Reserve Bank of India’s 4% target.
Future Outlook
To achieve sustained inflation reduction, key factors include:
Further decline in tomato prices and greater-than-usual winter vegetable price corrections.
Diminished impact of oils and fats inflation.
A strong Rabi crop to reduce cereal prices, especially wheat.
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