Government affirms its number, says no ‘overestimation’ in retail inflation

The government has dismissed the analysis presented by some economists that retail inflation for January had been “overestimated”. The government has reiterated that Ministry of Statistics and Programme Implementation (MoSPI) data is okay and there is no overestimation, The Economic Times (ET) said in its report.

Several economists have pointed out that January’s retail inflation data may have been overestimated by 23 basis points due to a variation in the price index for cereals. One basis point is one-hundredth of a percentage point.

The report said while the retail inflation numbers released by the government showed a jump of 6.53 per cent, various economists believe consumer inflation was lower at 6.3 per cent for January. However, the inflation rate for the food basket was at 5.94 per cent in January, up from 4.19 per cent in December.

Data released by the MoSPI’s National Statistical Office (NSO) shows that rural retail inflation was 6.65 per cent. In comparison, urban inflation was 4.79 per cent in January 2023.