Retail inflation at 6.09% in October, breaches RBI’s upper band after 2 yrs | Economy & Policy News

Retail inflation in India rose to 6.09 per cent in October, breaching the Reserve Bank of India’s (RBI’s) upper tolerance limit of 6 per cent for the first time in two years, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Thursday. The rise was largely driven by higher food prices.

 

The Consumer Price Index (CPI)-based inflation stood at 5.54 per cent in September. The October reading is also the highest since the new CPI series with base year 2024 was introduced. The RBI’s inflation target is 4 per cent, with a tolerance band of 2 per cent on either side.

  

Food inflation rises to 8.94% in October

 

Food inflation, measured by the Consumer Food Price Index (CFPI), rose to 8.94 per cent in October from 7.74 per cent in September. 

 

Among food items, onion prices recorded the highest inflation at 116.22 per cent in October, up from 108.13 per cent in September. Garlic inflation increased to 60.74 per cent from 54.62 per cent, while ginger prices rose 48.32 per cent.

 

Lemon prices recorded inflation of 47.30 per cent, compared with 36.41 per cent in the previous month. Silver jewellery also saw high inflation at 52.39 per cent, although this was lower than 87.82 per cent in September.

 

On the other hand, potato prices continued to decline, with deflation at 14.24 per cent in October. Cauliflower prices fell 10.57 per cent, while coconut prices declined 5.60 per cent. Brinjal and cabbage recorded deflation of 3.34 per cent and 1.92 per cent, respectively.

 

Rural inflation higher than urban inflation

 

Inflation remained higher in rural areas than in urban centres during October. Rural inflation rose to 6.63 per cent from 6.08 per cent in September, while urban inflation increased to 5.41 per cent from 4.88 per cent.

 

Food inflation in rural areas stood at 9.09 per cent, compared with 8.68 per cent in urban areas.

 

Among other categories, restaurants and accommodation services recorded inflation of 10.24 per cent in rural areas and 9.90 per cent in urban areas. Personal care, social protection and miscellaneous goods and services saw inflation of 10.84 per cent in rural areas and 9.24 per cent in urban areas.

 

State-wise inflation trends

 

Among states with a population of more than 5 million, inflation trends varied across regions. The state-wise data showed that price pressures remained elevated in several states, with food inflation contributing to the increase in the headline rate.

 

Andhra Pradesh recorded rural and urban inflation of 7.81 per cent and 6.37 per cent, respectively. Karnataka’s inflation stood at 7.54 per cent in rural areas and 6.60 per cent in urban areas, while Kerala recorded 7.01 per cent and 5.58 per cent, respectively.

 

Among other large states, inflation in Maharashtra stood at 6.86 per cent in rural areas and 5.20 per cent in urban areas. Uttar Pradesh recorded rural inflation of 7.20 per cent and urban inflation of 4.88 per cent.

 

In Delhi, inflation stood at 5.24 per cent in rural areas and 3.77 per cent in urban areas.