Food Price Inflation rise to 5.04% in One Year
In India, the consumer food price inflation has doubled in one year. According to the labor department reports, consumer goods prices raised nearly 8.05% since March 21. On March 21, the food price inflation stood at 3.94%. Now, it remains to reach 8.04% and inflation happens especially in rural areas.
The Consumer Food Price Index in rural areas stood at 5.81% in Feb 2022. As of March 2022, CPI increased by 6.95%, a 17-month high, with significant increases observed in many categories. Over the past three months, the retail inflation reading has gone above the upper limit of the RBI’s tolerance band.
A rise in the price of edible oils, vegetables, cereals, and livestock products such as milk, meat, and fish boosted food & beverage inflation by 7.47% YoY. Food prices rose sequentially by 1.32% in February, after falling for three months.
With the Russia-Ukraine conflict driving up the price of edible oil, inflation in ‘oils and fats’ hit 18.79%. Sunflower oil is a major export from Ukraine. Prices of vegetables rose by 11.6% in March compared to February 2022, while prices of meat and fish rose by 9.63%.
During its recent monetary policy review, the Reserve Bank of India revised its inflation forecast upward from 4.5% to 5.7%. Oil and commodity prices have been sharply rising globally. Previously, the RBI prioritized growth, now it is prioritizing inflation.
According to a Reuters poll, food prices were expected to increase one percent in March, causing inflation to rise to 6.35%.