Retail inflation declines to 17-month low in November 2018 at 2.33%

Retail inflation dropped to a 17-month low in November at 2.33 per cent, mainly on account of decline in prices of kitchen essentials like vegetables and pulses. Retail inflation, which is calculated on the consumer price index (CPI), for October this year has been revised slightly up at 3.38 per cent from 3.31 per cent earlier, as per data from the Central Statistics Office (CSO). A year ago, in November 2017, it was at 4.88 per cent.

Retail inflation, a key input for the RBI to decide on its monetary policy, was lower than this in June 2017 when it stood at 1.46 per cent, as per data by the Ministry of Statistics and Programme Implementation (MOSPI). The CSO comes under MOSPI.

For pulses and its products, the rate of deflation slowed a tad at (-) 9.22 per cent from (-) 10.28 per cent. The overall food inflation showed a negative print of 2.61 per cent in November against an uptick of 0.86 per cent in October.

The Central Statistics Office (CSO) data showed the Consumer Food Price Index (CFPI) deflated further to (-)2.61 per cent in November from (-)0.86 per cent in October 2018.

Higher production in the manufacturing sector, especially of capital goods and consumer durables, accelerated India’s industrial output growth to 8.1 per cent in October from a rise of 4.46 per cent in September and 1.8 per cent during the corresponding period of the previous fiscal.

“The cumulative growth for the period April-October 2018 over the corresponding period of the previous year stands at 5.6 per cent,” the ‘Quick Estimates’ of IIP released by the Ministry of Statistics and Programme Implementation showed.

On a YoY (year-on-year) basis, the manufacturing sector’s output expanded at 7.9 per cent, while mining production edged-up by 7 per cent and the sub-index of electricity generation increased by 10.8 per cent.

The output of primary goods, which has the highest weightage of 34.04, grew by 6 per cent. The output of intermediate goods, which has the second highest weightage, inched up by 1.8 per cent.

Similarly, the output of consumer non-durables rose during October by 7.9 per cent, and that of consumer durables by 17.6 per cent.

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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