CPI for India showed a four-month low of 4.87% in October 2023 : Delhi and Chhattisgarh reported least inflation rate

The Consumer Price Index (CPI) for India showed a four-month low of 4.87% in October 2023, down from 5.02% in September 2023, as a result of food prices cooling.

Inflation rate is still higher than targeted inflation rate

It is noteworthy that even with the recent cooling off; the price is still significantly higher than the RBI's comfort level for retail inflation, which is 4%. It was recently emphasized by Governor Shaktikanta Das that the monetary policy panel is dedicated to lowering it to that level.

June saw the previous low point in inflation, which was 4.87%. At its October meeting, the RBI Monetary Policy Committee (MPC) moderated its forecast for CPI inflation from 6.7% in 2022–2023 to 5.4% in 2023–2024.

The National Statistical Office (NSO) reported that the food basket's inflation was 6.61%, slightly lower than the 7% inflation in the previous month and the 6.62% inflation in September of last year. In the case of vegetables, meat and fish, and "light and fuel," the inflation rate decreased by 13.73%, but it stayed low overall. This was the case with oil and fat.

Delhi and Chhattisgarh reported least inflation in the country

Of the states, Odisha, Rajasthan, and Haryana had inflation rates higher than 6%. States with higher rates of inflation than the national average of 4.87% included Bihar, Gujarat, Karnataka, Telangana, Uttar Pradesh, and Punjab. The states with the least inflation were Delhi and Chhattisgarh. In India as a whole, retail inflation was 4.62% in urban areas and 5.12% in rural areas.

The RBI has been given a mandate by the government to make sure that CPI inflation stays at 4% with a 2% margin of error. When determining its bi-monthly monetary policy, the central bank primarily takes retail inflation into account.

The retail inflation rate for October 2023 was higher than expected and less than the level recorded in September 2023, according to Sujan Hajra, chief economist and executive director of Anand Rathi Shares and Stock Brokers.

However, given the noted volatility of the monthly inflation figures, this should not be cause for concern. An inflation rate that has now dropped below 5% would provide the central bank with comfort, according to Hajra, as long as the general trend of declining inflation continues.

RBI is expected to keep the halt position with cooling inflation

The Reserve Bank of India will keep the halt position in place for the foreseeable future due to decreasing inflation and continuous economic resilience. Over the course of the next 12 months, inflation is expected to vary between 4% and 5%. Accordingly, we believe there is minimal chance of any rate action taking place during this time frame, continued Hajra.

Also read: Commercial LPG gas cylinder prices went up by Rs. 100. Check any possible effects on consumers

OTT India updates you with the latest news, Country’s no.1 digital news platform OTT India, Keeps you updated with national, and international news from all around the world. For more such updates, download the OTT India app on your Android and IOS device.