Retail Inflation Edges Higher To 4.48% In Oct Due To Rise In Fuel Prices

Retail inflation rose 4.48 per cent in October 2021 from 4.35 per cent in September, mainly due to higher fuel prices, government data showed on Friday. This was higher than a recent poll conducted by news agency Reuters, which estimated that the retail inflation declined to a six-month low, at around 4.32 per cent in October. The Reuters poll was conducted between November 8-9 with 43 economists. 

The food inflation - determined by the consumer food price index rose to 0.85 per cent in October, compared to 0.68 per cent in September. According to data released by the National Statistical Office (NSO), the inflation in 'fuel and light' category remained elevated at 14.35 per cent during the month.

The retail inflation rising to 4.48 per cent in October is within the Reserve Bank of India's comfort zone of two per cent - six per cent, for the fourth straight month.

The Reserve Bank of India (RBI), which mainly factors retail inflation while arriving at its bi-monthly monetary policy, has been mandated by the government to keep it at four per cent, with a tolerance band of two per cent on either side.

The central bank has projected the CPI inflation at 5.3 per cent for financial year 2021-22, with 5.1 per cent in the second quarter, 4.5 per cent in third, and 5.8 per cent in the last quarter of the fiscal, with risks broadly balanced.

The Reserve Bank of India (RBI) tracks the retail inflation - or the rate of increase in consumer prices as determined by the Consumer Price Index (CPI). Separate government data today showed that factory output rose to 3.1 per cent in October.