Rise in food prices pushed the retail inflation higher in October to 7-month high of 3.58 per cent, according to the official data showed on Monday. The data furnished by the Ministry of Statistics & Programme Implementation, October’s consumer price index (CPI) inflation rose to 3.58 per cent from 3.28 per cent reported for September.
However, on a year-on-year (YoY) basis, the CPI inflation last month was lower than 4.20 per cent recorded in October 2016. The overall food prices, as gauged by the Consumer Food Price Index (CFPI) rose to 1.90 per cent during the month under review from 1.25 per cent in September 2017.
Costlier food items, particularly vegetables, was the cause of concern for the price rise. As per the data, the October inflation for the food basket increased to 1.9 per cent. It was 1.25 per cent in September. "The rate of price rise in the vegetable segment almost doubled to 7.47 per cent as against 3.92 per cent in September," it said.
However, higher inflation was also noted in protein rich items like eggs and milk (and its products). However, fruits were comparably cheaper in October on sequential basis. Inflation in pulses continued to decline and settled at (-) 23.13 per cent. It was (-) 22.51 per cent in September. “Fuel and light were costlier on sequential basis. Higher inflation was also noted in housing segment,” the data said.
All eyes will be on the current fiscal's sixth bi-monthly meeting of the Monetary Policy Committee, headed by RBI Governor Urjit Patel, on December 5-6.Retail inflation, a key input for RBI in setting the key interest rate, has been rising consistently since June amid a slowdown in factory output measured on Index of Industrial Production.