The growth rate of India’s retail inflation, which is measured by the Consumer Price Index (CPI), climbed 7.61 per cent in the month of October. Separately, the country’s factory output, which is measured in terms of Index of Industrial Production (IIP), witnessed a growth of 0.2 per cent in the month of September, according to two separate data released by the Ministry of Statistics & Programme Implementation (MoSPI) on Thursday.
The CPI for the month of September was also revised to 7.27 per cent from 7.34 per cent.
The retail inflation has grown beyond the Reserve Bank of India’s (RBI) upper margin of 6 per cent. The government has mandated the central bank to keep retail inflation within the range of 4 per cent with a margin of 2 per cent on either side.
The central bank mainly factors in retail inflation while deciding its bi-monthly monetary policy. In its bi-monthly monetary policy meeting last month, the RBI had kept its key interest rates unchanged and decided to maintain its accommodative monetary policy stance to support growth amid the pandemic.
The rise in retail inflation in October was primarily on account of rising food prices. The Consumer Food Price Index (CFPI) or the inflation in the food basket climbed to 11.07 per cent in the month of October, up from 10.68 per cent in September, the data revealed.
The growth in inflation was primarily due to a rise in vegetable prices that surged 22.51 per cent on-year rise in October. Apart from vegetables, the eggs segment saw a rise of 21.81 per cent, while that of meat and fish rose 18.70 per cent and pulses and products prices gained 18.34 per cent. The oils and fats segment also witnessed a rise of 15.17 per cent.
Index of Industrial Production (IIP)
Separately, the country’s factory output, measured in terms of IIP witnessed a growth of 0.2 per cent on-year to 123.2 during the month of September, separate data released by the MoSPI showed.
The IIP had contracted 4.6 per cent in September 2019.
“With the gradual relaxation of restrictions, there has been a relative improvement in the economic activities by varying degrees as well as in data reporting,” the MoSPI statement said.
As per the data, the electricity generation rose by 4.9 per cent to 166.4 in October, and the mining sector output grew by 1.4 per cent to 87.6. However, the manufacturing sector contracted 0.6 per cent to 125.3.
The IIP during the period of April 2020-September 2020 showed a contraction of 21.1 per cent from the corresponding period year ago. The IIP had grown 1.3 per cent during the same period last year, the data showed.
“It may not be appropriate to compare the IIP in the post pandemic months with the IIP for months preceding the COVID 19 pandemic,” the ministry said.
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