India’s retail inflation in March dropped to a 15-month low of 5.66%, according to the latest data released by the National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation. Retail inflation, which impacts everyday life, was 6.44% and February and 6.95% a year ago.
Over the past one year, the Reserve Bank of India, hiked interest rates to tighten the money supply in its efforts to combat inflation and bring it below the target of 4%. Inflation of the overall food basket also showed signs of easing off at 4.79% as compared to 5.95% a month before and has come down significantly from a high of 7.68% a year before.
According to the data released by the NSO, the inflation drop in the food basket is on the account of decline of 8.51% in the vegetable basket, oil by 7.86% and meat and fish by 1.42%. However, increase in inflation was recorded for spices by 18.2% and cereals by 15.27%. in contrast, the inflation for spices went up 18.21% and cereals 15.27% and milk products by 9.31%
In absolute terms, inflation in March 2023 came down by 213 basis points compared to the peak of 7.79% in April 2022. The increase in the prices of cereals is mainly on the account of lower production of kharif crop, while supply shortages for spice led to the price rise.