Food prices persistently high despite marginal easing in retail inflation

In April, India witnessed a marginal easing in retail inflation, with the Consumer Price Index (CPI) edging down to 4.83 per cent from 4.85 per cent in March. However, the relief was overshadowed by the persistent surge in food prices, which continued to escalate, indicating challenges for policymakers in reigning in inflationary pressures.

The latest data released by the ministry of statistics and programme implementation revealed that food inflation rose to 8.7 per cent in April, up from 8.5 per cent in March. This upward trajectory was primarily driven by the increasing costs of cereals and meat. Even though vegetables, which have been persistently elevated, experienced a slight softening, the overall trend remained worrisome.

The relentless rise in food prices has been a cause for concern, particularly as it constitutes a significant portion of the CPI gauge, accounting for 39.1 per cent. For the past six months, food inflation has remained stubbornly above 8 per cent, exerting sustained pressure on overall inflation levels.

Contributing to the marginal easing of the headline number in April were non-food components, which helped curtail the CPI-based inflation gauge to 4.83 per cent, two basis points lower than in March. Notably, fuel inflation decreased to 4.2 per cent from 3.4 per cent in March, while core inflation softened to an all-time low of 3.2 per cent.

Leave a Comment