Retail inflation in India eased to a 7-month of 3.61 per cent in February driven by a further drop in food prices. This marks a 0.65 per cent decline from January’s inflation rate and is the lowest level recorded since July 2024. The slowdown in price rise brings relief to consumers amid ongoing economic fluctuations.
Food inflation in February dropped to its lowest level since May 2023, falling 222 basis points compared to January, as per official data. The sharp decline in overall food inflation was mainly driven by lower prices of vegetables, eggs, meat & fish, pulses, and dairy products.
The key items having the lowest year-on-year inflation in February are ginger (-35.81 per cent), jeera (-28.77 per cent), tomato (-28.51 per cent), cauliflower (-21.19 per cent), garlic (-20.32 per cent), official figures show.
Prices of fuel came down during the month, easing the burden on household budgets with inflation being recorded at (-) 1.33 per cent during February. As retail inflation continues with its downward trend and has fallen below the RBI’s targeted level of 4 per cent, the central bank will have more headroom to go for a rate cut to propel economic growth and create more jobs.
RBI Governor Sanjay Malhotra last month announced a 25 basis cut in the policy rate from 6.5 per cent to 6.25 per cent in the monetary policy review to accelerate growth growth amid global uncertainties. He said that inflation has declined and is expected to further moderate and gradually align with the RBI’s target of 4 per cent.
The monetary policy decision maintains a delicate balance between controlling inflation and pushing up the growth rate in a slowing economy, The MPC also unanimously decided to continue with its neutral stance in monetary policy and will focus on inflation while supporting growth. This would provide flexibility to respond to the macroeconomic environment, Malhotra said. (With IANS Inputs)
