Synopsis
India's retail inflation rate has decreased to 3.34% in March 2023, the lowest since August 2019, according to the Ministry of Statistics. Food inflation has also eased to 2.69%. This trend is attributed to lower prices in various categories, including vegetables and pulses, and reflects a broader positive outlook for food inflation.Key Takeaways
- Inflation rate at 3.34% in March 2023.
- Food inflation fell to 2.69%.
- Key price drops in ginger, tomatoes, and garlic.
- Housing inflation at 3.03%, up from 2.91%.
- RBI projects CPI inflation at 4% for FY 2023-24.
New Delhi, April 15 (NationPress) India's annual inflation rate, calculated using the Consumer Price Index (CPI), has decreased to 3.34% in March 2023, marking the lowest level since August 2019, as reported by the Ministry of Statistics on Tuesday.
Food inflation, for March, has eased to 2.69%, the lowest since November 2021.
The notable drop in both headline and food inflation in March 2023 is primarily linked to the decline in prices of vegetables, eggs, pulses, meat & fish, cereals, and milk, as per the official announcement.
Items with the steepest year-on-year price drops in March include ginger (-38.11%), tomato (-34.96%), cauliflower (-25.99%), jeera (-25.86%), and garlic (-25.22%).
The housing inflation rate for the month stands at 3.03%, an increase from 2.91% in February 2023. This index is calculated solely for the urban sector.
In March, the inflation rate for fuel & light is 1.48%, while the education inflation rate is 3.98%, the data indicates.
Retail inflation in India has shown a downward trend in recent months. The Reserve Bank’s Monetary Policy Committee has adjusted its inflation prediction for 2023-24 to 4%, down from 4.2%, citing a positive outlook for food inflation, as stated by RBI Governor Sanjay Malhotra last week.
“Headline inflation has moderated during January-February 2023, following a significant decline in food inflation. The outlook for food inflation has improved significantly. Concerns regarding rabi crops have lessened considerably, and the second advance estimates suggest a record wheat production and increased yields of key pulses compared to last year,” he noted.
The RBI Governor remarked that with strong kharif arrivals, this is anticipated to create conditions for a long-term reduction in food inflation.
“The significant drop in inflation expectations from our latest survey for the next three months and one year will aid in stabilizing inflation expectations moving forward,” he emphasized.
Moreover, the decline in crude oil prices is favorable for the inflation outlook. However, ongoing global market uncertainties and the potential for adverse weather-related supply issues present risks to the inflation path, according to the RBI Governor.
Considering all these factors and assuming normal monsoon conditions, CPI inflation for the fiscal year 2023-24 is projected at 4.0%, with quarterly estimates of 3.6% for Q1, 3.9% for Q2, 3.8% for Q3, and 4.4% for Q4. The risks are considered evenly balanced, he maintained.
