Slight increase in retail inflation, inflation increased to 3.4 percent in March due to tension in Gulf countries

Retail inflation increased marginally to 3.4 percent in March, from 3.21 percent in February. This information was received from the data released by the government on Monday. Due to the ongoing tension in the Gulf countries, prices have been affected due to the affected supply chain and this increase in inflation rate has been recorded. Based on Consumer Price Index (CPI) data, the rate of increase in food prices in March stood at 3.87 percent, which is higher than 3.47 percent in February last month. Retail inflation in rural areas was recorded at 3.63 percent, while retail inflation in urban areas was recorded at 3.11 percent.

Gold and silver adjusted crude oil prices for inflation

There was a huge increase in the prices of crude oil in March. However, the fall in the prices of gold and silver played an important role in adjusting it to a great extent. Despite this increase in inflation, inflation under the revised framework has remained below the RBI’s medium-term target band of 4% (2%-6%) for 12 consecutive months. According to data released by the Ministry of Statistics and Program Implementation, food inflation rose to 3.87% in March from 3.47% in February. Food inflation has the highest weightage in the CPI basket. Apart from this, the inflation rate in electricity, gas and other fuels category stood at 1.65%.

Relief continues in prices of garlic, onion and potatoes

Deflation continued in the prices of some major kitchen items in March. The fall in garlic prices was 10.18%, whereas in February it was 31.10%. At the same time, onion prices fell by 27.76%, which was slightly less than the previous month’s decline of 28.20%. Potato prices also remained in negative territory (-18.98%), compared to -18.47% in February. Housing inflation stood at 2.11% in March, while it was 2.12% in February. Inflation in clothing and footwear was recorded at 2.75%, while it was 2.81% in February.