New Delhi, Jan 12: India’s retail inflation on Friday grew at 5.21 per cent in December on rise in prices of food items, egg and vegetables, dashing hopes of interest rate cut in the near future. In December 2015, it was 3.41 per cent. As per the data released by the Central Statistics Office (CSO), inflation for the food basket increased to 4.96 per cent in December from 4.42 per cent in the preceding month.
According to the data furnished by the Ministry of Statistics and Programme Implementation, the retail inflation, measured by Consumer Price Index (CPI), hit a 17-month high at 5.21 per cent this month as against 4.88 per cent in November. This was 3.58 per cent in October 2017. The data revealed that eggs, vegetables and fruits became costlier, while inflation moderated in case of cereals and pulses.
On a year-on-year (YoY) basis, the CPI inflation last month was higher than the 3.41 per cent recorded in December 2016. The Reserve Bank has been asked by the government to keep inflation at 4 per cent, plus or minus 2 per cent, and its rise beyond the comfort zone will put pressure on the central bank not cut interest rate (repo rate).
Meanwhile, India’s factory output zoomed by over 8 per cent in November from 1.99 per cent in October and 5.1 per cent during the corresponding period of 2016-17, official data showed.