Higher food and fuel prices kept the annual all-India general consumer price inflation at 7.65 per cent in January, higher than the wholesale price inflation for that month.
This is the first time that the Central Statistics Office (CSO) has come out with nation-wide inflation data based on retail prices, with 2010 as the base year. The new Consumer Price Index (CPI) series covers price movements in services that account for 55 per cent of GDP, giving policymakers a better idea of price pressure at the consumer level. It is expected to replace the Wholesale Price Index (WPI) as India's main inflation measure.
Scope to cut rates
According to CSO data released by Mr Srikant Jena, Minister of State (Independent charge) for Statistics on Tuesday, the consumer price inflation rates for rural and urban areas stood at 7.38 per cent and 8.25 per cent, respectively.
Inflation based on WPI was 6.55 per cent in January.
The consumer price inflation data supports the view that the Reserve Bank of India has room to cut interest rates, say economy watchers.
While the food and beverages segment recorded retail price inflation of 4.11 per cent, the ‘fuel and light' and ‘clothing and footwear' segment saw 13.13 per cent and 14.25 per cent increase, respectively, in January. In the food segment, the prices of vegetables recorded a 25 per cent decline, while milk prices went up 16.53 per cent, retail prices of fruits went up by 10.62 per cent, while those of pulses rose by 5.66 per cent. Egg, fish and meat prices soared by 10.45 per cent. Oils and fats also saw double-digit retail price increase at13.47 per cent. Sugar prices were up 1.84 per cent.
The CSO has also come out with State/Union Territory-wise general provisional CPI numbers for rural, urban and combined levels.
Price data have been collected from selected towns by the field operations division of National Sample Survey Organisation and from selected villages by the Department of Posts. Price data are received through Web portals being maintained by the National Informatics Centre.