India's retail inflation drops to 6.44% in February 2023

India’s retail inflation for February slows down to 6.44 percent as against 6.52 percent in January 2023, according to data published by the Ministry of Statistics and Programme Implementation on March 13.

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Trend of the Retail Inflation:

While the CPI in January stood at 6.52 percent, the same for December 2022 was at 5.72 percent. In November, it was 5.88 percent and 5.59 percent in October 2022.

Reason behind the downward trend of Retail Inflation:

Rise in food prices, which account for nearly half of the CPI basket, moderated last month to 5.95% from 6% in January. However, the bulk of the slowdown probably came from easing international prices and the government’s efforts to provide additional supplies of wheat.

Easing of Food Inflation:

Food price inflation came in at 5.9 percent, compared to 6 percent in January. The January inflation was largely cereals-driven.

However, there has been a crash of onion and potato prices. Despite this, food prices remained close to the 6 percent, indicating that cereals were still pretty expensive — thereby explaining the CPI inflation coming in at 6.44 percent, above Street expectations. Cereal prices were up 16.73 percent and milk prices came in at 9.65 percent.