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Wednesday, January 19, 2022

Retail inflation spikes to a 5-month high of 5.59% in Dec; IIP grows 1.4% in Nov, shows govt data

CPI Inflation Rate December, IIP Growth Rate November 2021: The retail inflation, measured by the Consumer Price Index (CPI), rose to a five-month high of 5.59 per cent in December. Separately, the factory output, measured in terms of Index of Industrial Production (IIP), grew by 1.4 per cent in November.

By: Express Web Desk | New Delhi |
Updated: January 12, 2022 6:22:20 pm
cpi retail inflationPeople purchasing vegetable from a wholesale market . (Express photo by Vishal Srivastav/File)

India CPI Inflation, IIP Growth Rate: The country’s retail inflation, which is measured by the Consumer Price Index (CPI), rose to a five-month high 5.59 per cent in the month of December. Separately, India’s factory output, measured in terms of Index of Industrial Production (IIP), witnessed a growth of 1.4 per cent in November, two separate data released by the Ministry of Statistics & Programme Implementation (MoSPI) showed on Wednesday.

The retail inflation for the month of November was 4.91 per cent.

The December CPI data has come within the Reserve Bank of India’s (RBI) upper margin of 6 per cent. The government has mandated the central bank to maintain retail inflation at 4 per cent with a margin of 2 per cent on either side for a five-year period ending March 2026.

The CPI data is mainly factored in by the RBI while making its bi-monthly monetary policy. Last month, the Monetary Policy Committee (MPC) of the central bank kept the repo rate unchanged for the ninth time in a row at 4 per cent while maintaining an ‘accommodative stance’ as long as necessary.

During the last meeting, RBI maintained the projected CPI inflation at 5.3 per cent during the ongoing financial year 2021-22. It estimated CPI inflation at 5.7 per cent in Q4 with risks broadly balanced.

The Consumer Food Price Index (CFPI) or the inflation in the food basket also spiked on-month during December to 4.05 per cent, from 1.87 per cent in November, the data revealed.

The spike in the food basket was due to a sharp rise in prices of oils and fats which climbed 24.32 per cent on year in December. Apart from this, the meat and fish prices saw a rise of 4.58 per cent while that milk and milk profducts gained 3.76 per cent and pulses and products rose 2.43 per cent. The vegetables segment slipped (-)2.99 per cent however fruits grew 3.54 per cent.

Apart from food and beverages, the fuel and light segment rose 10.95 per cent, clothing and footwear gained 8.30 per cent and the housing segment inched up 3.61 per cent.

Industrial output (IIP)

India’s factory output, which is measured in terms of IIP witnessed a growth of 1.4 per cent on-year to 128.5 during the month of November, separate data released by the MoSPI showed.

The IIP had slipped 1.6 per cent in November 2020, the data showed.

The industrial growth so far in the fiscal year 2021-22 (April-November) has surged 17.4 per cent, compared to a contraction of (-)15.3 per cent rise in the corresponding period a year ago, the data showed.

The growth in IIP data during November is primarily on account of the mining sectors which rose 5.0 per cent on-year to 111.9 in November. It was followed by the electricity sector that witnessed a growth of 2.1 per cent to 147.9. The manufacturing sector saw a 0.9 per cent growth to 129.6, the MoSPI data showed.

In November last year, the manufacturing sector had witnessed a contraction of (-)1.6 per cent. During the same period, the mining sector had fallen (-)5.4 per cent, while the electricity sector was the only one that had witnessed a growth of 3.5 per cent, the data showed.

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