Retail inflation eases to 5.48% in November due to easing vegetable prices

Retail inflation in India eased to 5.48% in November 2024, a significant decline from October’s 6.21%, according to government data released on Thursday. The reduction was driven primarily by lower food prices, especially vegetables. 

The Consumer Price Index (CPI)-based inflation for rural and urban areas stood at 5.95% and 4.83%, respectively. The Consumer Food Price Index (CFPI) inflation also dropped to 9.04% in November from 10.87% in October.

“During November 2024, a significant decline in inflation was observed in vegetables, pulses and products, sugar and confectionery, fruits, eggs, milk and products, spices, transport and communication, and personal care and effects subgroups,” said the Ministry of Statistics and Programme Implementation in a press release.

The top five items showing the highest year on year Inflation at the All India level in November 2024 are garlic (85.14), potato (66.65), cauliflower (47.70), cabbage (43.58) and coconut oil (42.13). The key items having the lowest year-on-year inflation in November 2024 are jeera (-35.04), ginger (-16.96), LPG-excluding conveyance (-10.24) and dry chillies (-9.73).

Reserve Bank of India (RBI) raised its inflation projection for the fiscal year to 4.8% from 4.5%, citing persistent food price pressures that could elevate inflation in the December quarter. CPI-based inflation peaked at 6.21% in October, the highest since September 2023, after averaging 3.6% during July-August. The urban housing inflation rate in November rose slightly to 2.87% from October’s 2.81%, while transport, communication, and personal care items also registered moderated price increases.

The easing inflation is expected to bring some respite to consumers, though persistent volatility in key food items remains a concern for policymakers.