India’s retail inflation eased more than estimated, indicating that the seasonal disruptions and one-off items that had pushed inflation upwards to a 17-month high are now starting to turn.
CPI inflation in India rose 4.4 percent in February, according to data released by the Central Statistics Office today. Economists polled by Bloomberg had forecast retail inflation at 4.7 percent. Inflation stood at 5.2 percent in December and 5.07 percent in January.
Higher vegetable prices, especially the seasonal surge seen in onions and tomatoes, has pushed up retail inflation since June last year when it hit an all-time low. However, a fresh supply of tomatoes starting December-end and onions starting March-end is expected to pull prices lower. Though prices eased in December, the seasonal food price moderation in winter was less than usual, the RBI noted in its February outlook.
Inflation Internals
- Food price inflation was at 3.26 percent compared to a 4.7 percent in January.
- Prices of pulses and products fell 17.35 percent year-on-year in February. Prices have softened for the fifteenth straight month.
- Fuel and light inflation stood at 6.8 percent in February compared to 7.73 percent in January.
- Housing inflation stood at 8.28 percent in February compared to 8.33 percent in January.
- Clothing and footwear inflation was at 5 percent in February compared to 4.94 percent in January.
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