New Delhi: Soaring vegetable prices pushed the retail inflation rate to a nine-month high of 5.49 percent in September, according to government data released on Monday.
The consumer price index (CPI)-based retail inflation rate was 3.65 percent in August and 5.02 percent in September 2023. The previous high inflation rate was witnessed in December 2023 at 5.69 percent.
As per data released by the National Statistics Office (NSO), the inflation rate in the food basket rose to 9.24 percent in September compared to 5.66 percent in August and 6.62 percent in the year-ago month.
"It is likely that the increase in inflation rate for the month of September 2024 is due to high base effect and weather conditions," NSO said.
According to another data released on Monday, the wholesale price inflation (WPI) rose to 1.84 percent in September as food items, especially vegetables, turned costlier.
The wholesale price index (WPI)-based inflation was 1.31 percent in August. It was (-) 0.07 percent in September last year.
The Reserve Bank of India (RBI), which kept the key short-term lending rate unchanged earlier this month, has been asked by the government to ensure the CPI inflation rate remains at 4 percent with a margin of 2 percent on either side.
The annual inflation rate in the vegetable basket in September was nearly 36 percent and in 'pulses and products' it was 9.81 percent. Fruits, too, were dearer.
However, inflation in spices was in the negative in September, compared to the year-ago month.
"The surge in food and beverages inflation in September 2024 vis-à-vis August 2024 was largely led by vegetable inflation, which surged to a 14-month high of 36 percent from 10.7 percent in the previous month.
"Excluding this, food and beverages inflation slumped to a 59-month low of 3.9 percent in September 2024 from 4.3 percent in August 2024," said Aditi Nayar, Chief Economist and head of Research and Outreach, Icra Ltd.
While unveiling the bi-monthly monetary policy on October 9, RBI Governor Shaktikanta Das had stressed that the central bank will have to closely monitor the price situation and keep the "inflation horse" under tight leash.
Das had also said the CPI print for September would see a big jump due to unfavourable base effects and pick-up in food price momentum, caused by the lingering effects of a shortfall in the production of onion, potato and chana dal (gram) in 2023-24, among other factors.
The NSO data further said while the national inflation rate is 5.49 percent, the corresponding rates for rural and urban work out at 5.87 percent and 5.05 percent, respectively.
The highest inflation rate was in Bihar (7.5 percent) while the lowest was in Delhi (3.67 percent). The inflation food items were higher in urban areas.
The year-on-year housing inflation rate in September was 2.78 percent.
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