Consumer price inflation jumps to 9.47

CPI jumped to 9.47 in March - exceeding the wholesale price rise of 6.89 for the period.

India8217;s annual consumer price inflation CPI index jumped to 9.47 in March8211;exceeding the wholesale price rise of 6.89 for the period8211;on a spurt in prices of protein-based food products,oils and fats,clothing materials and fuel items.

The consumer inflation rose sharply from 8.83 in February,reflecting immense price pressures in the economy. Retail prices of food and beverages,which account for almost half of the weighting in the CPI index,rose 8.22 in March from a year before,while the cost of fuel and electricity jumped 11.8,according to the released by the ministry of statistics and programme implementation on Wednesday. Clothing,bedding and footwear turned dearer by the maximum of 12.5 last month.

Milk and its products led the pack in price rise in the food and beverages segment,with a 15.22 jump in their rates in March,followed by a 14.2 rise in poils and fats and 10.06 in egg,fish and meat. Vegetables turned dearer by 9.55,while non-alcoholic beverages became more expensive by 10.2.

The CPI data,launched in February,are important as they factor in rate movements in services,thus giving policymakers a better idea of price rise than the wholesale-price-based inflation that captures price pressures experienced by trade intermediaries. Adequate capturing of inflation at the consumer level with demand-side price movements of both goods and services will help make better policy decisions.

Analysts said the reporting of fuel inflation is still suppressed and the numbers will rise if the government decides to pass on the complete burden of global crude oil spike to consumers. Crude oil poses serious risks to a potential flare-up in domestic prices,if the ongoing tensions between Iran and the West excerbates.

Factoring in risks to underlying inflationary pressure,the Reserve Bank of India pruned the main lending rate8211;the repo rate8211; on Tuesday by sharper-than-expected 50 basis points to prop up a faltering economy,but cautioned against limited scope to cut the rate further.