May retail inflation lowest in 2 years! CPI-based inflation cools to 4.25 pc from 4.7 pc in April | Check April's IIP data
May Retail Inflation: At 4.25 per cent, the retail inflation is within RBI's tolerance band of 4 per cent with a tolerance band of 2-6 per cent. The consumer food price index cooled down to 2.91 per cent in the month of May from 3.84 per cent in April while rural inflation came in at 4.17 per cent.
Updated Jun 12, 2023 | 06:26 PM IST
May CPI Inflation
Photo : ET Now Digital
May Retail Inflation: Retail or CPI-based inflation in the month of May has eased to a two-year or 25-month low of 4.25 per cent, according to data released by the Central Statistics Office on Monday. The the headline inflation based on the consumer price index (CPI) once again eased to 4.25 per cent in May 2023 versus 4.7 per cent in April 2023.
At 4.25 per cent, the retail inflation is within RBI's tolerance band of 4 per cent with a tolerance band of 2-6 per cent. The consumer food price index cooled down to 2.91 per cent in the month of May from 3.84 per cent in April while rural inflation came in at 4.17 per cent and urban inflation at 4.27 per cent.
Inflation rate in the vegetables segment also saw a 8.1 per cent decline in May. Retail inflation in food & beverage and fuel segments stood at 3.29 per cent and 4.64 per cent, respectively. For cereals, the inflation rate came in at 12.65 per cent as against 13.67 per cent.
Food and fuel prices have moderated in the recent past. This coupled with the declining price of cereals and vegetables along with lower energy prices have led to a further dip in retail inflation in May.
Notably, Reserve Bank of India Governor Shaktikanta Das last week announced the central bank’s CPI inflation forecast for the year ahead. He said retail inflation is projected at 5.1 per cent for 2023-24, with Q1 at 4.6 per cent, Q2 at 5.2 per cent, Q3 at 5.4 per cent and Q4 at 5.2 per cent. The risks are evenly balanced.
“We need to maintain Arjuna’s eye on the evolving inflation scenario. Let me re-emphasise that headline inflation still remains above the target and being within the tolerance band is not enough. Our goal is to achieve the target of 4.0 per cent, going forward,” Das underscored.
April IIP Data
The Ministry of Statistics & Programme Implementation also released the quick estimates of Index of Industrial Production (IIP) for the month of April 2023. India's industrial production rose 4.2 per cent in April. Factory output measured in terms of the Index of Industrial Production (IIP) grew 6.7 per cent in April 2022.
The manufacturing sector's output increased by 4.9 per cent in April 2023 versus 5.6 per cent last year. Mining output rose 5.1 per cent during the month under review. April primary sector goods output growth stood at 1.9 per cent vs 10.3 per cent YoY.
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