Further Relief from Inflation for Farmers and Rural Workers
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Synopsis
New Delhi, Jan 23 (NationPress) The inflation rates for Agricultural and Rural Labourers have dropped to 5.01% and 5.05% respectively in December 2024, significantly down from last year’s figures, providing much-needed relief to these vulnerable groups.
Key Takeaways
- Inflation Rates Decline: Agricultural and rural labourers see a drop in inflation rates.
- Current Rates: 5.01% and 5.05% as of December 2024.
- Previous Rates: 7.71% and 7.46% in December 2023.
- Economic Impact: More disposable income for workers.
- RBI Policies: Adjustments made to CRR to support lending.
New Delhi, Jan 23 (NationPress) The year-on-year inflation rates based on the all-India Consumer Price Index for Agricultural Labourers and Rural Labourers in December 2024 decreased to 5.01 per cent and 5.05 per cent, respectively, in contrast to the corresponding figures of 7.71 per cent and 7.46 per cent from the same month last year, as reported by the Ministry of Labour and Employment on Thursday.
The inflation rate for both categories of labourers has been witnessing a decline over the last four months.
This reduction in inflation burden is a welcome relief for agricultural and rural workers, who are often the most affected by rising prices. With the easing rates, these workers now have more disposable income to purchase a broader range of goods, resulting in an improved quality of life.
This decline is set against the backdrop of India's retail price inflation, which fell to a four-month low of 5.22 per cent in December due to a decrease in prices of vegetables, pulses, and sugar, offering some relief to household budgets.
The downward trend in inflation follows a peak of 6.21 per cent in October, marking a significant reduction from 5.48 per cent in November.
The decline in inflation is particularly positive as it was the first instance of retail inflation surpassing the RBI's upper limit of 6 per cent in October. The RBI is now looking for inflation to stabilize at 4 per cent sustainably before considering any interest rate cuts to encourage growth.
In its last policy review, the RBI reduced the cash reserve ratio (CRR) for banks by 0.5 per cent, aiming to make more funds available for lending to stimulate economic growth, while keeping the key policy repo rate steady at 6.5 per cent due to ongoing inflation concerns.
The CRR has been lowered from 4.5 per cent to 4 per cent, which will inject Rs 1.16 lakh crore into the banking system and help lower market interest rates.
This monetary policy decision strikes a careful balance between curbing inflation and promoting growth amidst a slowing economy.
In his latest monetary policy outlook, former RBI Governor Shaktikanta Das remarked, "India's growth trajectory remains robust. Inflation is on a decreasing trend, yet we must remain vigilant to significant risks in the economic outlook. These risks must not be underestimated."
He expressed optimism regarding the economic outlook, noting that "the equilibrium between inflation and growth is well-positioned."
