• UGI USER
  • Apr 13, 2024
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INFLATION DIPS TO 10-MONTH LOW; FOOD PRICES PRESSURED BY HEATWAVE.

Why in the news?

Retail inflation in India drops to a 10-month low of 4.85% in March, driven by moderation in food and fuel prices.

Source:TH

About Retail Inflation in March:

  • Retail inflation in India dropped to a 10-month low of 4.85% in March, primarily due to moderation in food and fuel prices, along with lower rates for petrol, diesel, and LPG.
  • However, the Consumer Food Price Index-based inflation remained elevated at 8.52% in March, persisting above the 8% mark for the fifth consecutive month.
  • Rural areas experienced higher food inflation compared to urban areas, with rural consumers facing slightly higher inflation at 5.45% compared to 4.14% for urban consumers.
What is Consumer Food Price Inflation (CFPI)?

  • Consumer Food Price Inflation (CFPI) measures price changes in food items in a consumer’s basket.
  • It focuses exclusively on food products within the Consumer Price Index (CPI).
  • CFPI calculates the rate at which prices of food consumed by households are increasing over time.
  • It is a sub-component of CPI, with RBI using CPI-Combined (CPI-C) for this purpose.

Components of CFPI

  • CFPI tracks price changes of commonly consumed food items like cereals, vegetables, fruits, dairy, and meat.
  • It provides insights into inflation trends specifically related to food staples and essentials.

What is the Consumer Price Index (CPI)?

  • Consumer Price Index (CPI) measures the change in prices of goods and services bought by consumers.
  • Includes food, clothing, housing, transportation, and medical care.

Types:

  • CPI for Industrial Workers (IW)
  • CPI for Agricultural Labourer (AL)
  • CPI for Rural Labourer (RL)
  • CPI for Urban Non-Manual Employees (UNME)
  • Compiled by the Labour Bureau and NSO.

Source:https://indianexpress.com/article/business/economy/retail-inflation-declines-to-5-month-low-in-march-9266434/#:~:text=IIP%20at%20four%2Dmonth%20high%20of%205.7%25%20in%20Feb&text=Retail%20inflation%20slipped%20to%20a,Statistical%20Office%20(NSO)%20Friday.