Retail inflation falls to 11-month low of 4.83% in April

CPI Inflation has dropped for the fourth time in a row to 4.83 per cent in April 2024. Inflation has now come down to lowest level in last 11 months. Rural inflation has fallen to 5.43 per cent in the month under consideration. While, urban inflation has corrected to 4.11 per cent. Inflation has remained lower than RBI’s upper limit of tolerance band which is six per cent for the last eight straight months now.

Retail inflation print has corrected on the back of low milk inflation, transport and communication inflation, fuel and light and health inflation. Continuous fall in spices inflation and pulses and products inflation has also helped in keeping it under RBI’s upper limit of tolerance band.

Overall, retail inflation has continued to remain low mainly because of low core inflation. It is headline inflation which continues to remain a hedache for the government.

Due to severe heat waves and lower than average pre-monsoon rainfall in April 2024 and resultant price rise in vegetables and fruits, inflation of these two items increased in the month under consideration to 27.80 per cent and 5.22 per cent, respectively. On the other hand, even though vegetable inflation showed slight recovery and slipped to 27.80 per cent in April. It continues to remain at worrysome levels.

Due to recent cut in mobility fuel prices, fuel and ligh inflation came in negative territory at (-) 3.24 per cent in April 2024. While, transport and communication inflation fell to 1.09 per cent.

Pulses and products inflation, after increasing continuously from mid last year, have shown signs of correction since the beginning of the current calendar year. It eased a bit to 16.84 per cent in April 2024. It has continuously fallen in the last four months. Albeit, it can’t be said the pulses prices have come down to low levels. It still is at worrysome levels.

Similarly, spices inflation has also remained in double digits in last one year. From current year beginning, it has showed correction and fell for fifth straight month in April 2024 and came in at 7.75 per cent.

Cereals and products inflation has continued to fall since January 2023. Although, it again started to increase from March 2024 onwards. It came in at 8.63 per cent in April 2024.

Meat and fish inflation had largely remained muted in 2023. But since the beginning of the current calendar year, meat and fish inflation has continuously increased and came in at 8.17 per cent in April. Egg inflation on the other hand fell to 7.08 per cent.