India's Retail Inflation Leaps to 6.1%, Breaches RBI's Upper Limit

India's retail inflation, which is measured by the Consumer Price Index (CPI), rose to 6.01 per cent in January 2022, as per government data released on Monday, 14 February.

(Photo: The Quint/Arnica Kala)

India's retail inflation, which is measured by the Consumer Price Index (CPI), rose to 6.01 per cent in January 2022, as per the government data released on Monday, 14 February.

The trend assumes significance as the retail inflation has breached the government-mandated Reserve Bank of India’s (RBI) upper limit of 6 per cent. The central bank has a CPI target range of 2-6 percent.

Higher food prices, as well as rising commodity costs, are responsible for lifting India's January 2022 retail inflation on a sequential as well as year-on-year basis, data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Monday showed.

As per the data, the rate of rise in the Consumer Food Price Index, which measures the changes in retail prices of food products, increased to 5.43 per cent last month from 4.05 per cent in December 2021.

The Consumer Price Index (CPI) had been recorded at 5.66 per cent in December 2021. The rise in the last month's retail inflation was faster than the 4.06 percent increase in prices recorded for January 2021.

A consumer price index is based on the price of a weighted average market basket of consumer goods and services purchased by average households. Changes in measured CPI track changes in prices over time.