Why does Retail Inflation continue to increase..?

Sowmiya Sriram
Why does Retail Inflation continue to increase..?

Although inflation in india has started to ease again in recent months, it is still above the RBI's forecast. India's first quarter retail inflation rate was 7.28%. The Reserve bank had predicted this to touch the level of 7.1%. This rate of retail inflation has increased as food prices have risen. The retail inflation rate hit a 5-month high of 6.7% in July last year. However, it peaked again in August. This has again become a matter of concern.
This has affected the supply chain in various parts of the country due to rain. In particular, the price ratio of many food items has been increasing again since last march 2022. It has increased from 6.75% to 7.75%. On the one hand, to reduce these inflation rates, the export of rice, wheat flour, pulses, etc. has been banned.
This will reduce exports and increase reserves. The government hopes that this will be used to keep prices under control. Apart from this, the duty has also been increased on many export items.
 This is also expected to have an impact on exports.On the one hand, the government's action, on the other hand, the central bank has started increasing interest rates to keep inflation under control.
The RBI had last august forecast inflation to ease to 7.1% in the second quarter. It was 7.4% earlier. However, it is believed that this rate of inflation may continue as the festive season is about to begin. Because of floods and erratic monsoons, food prices are expected to fluctuate wildly.
For more interesting updates click and follow Indiaherald WhatsApp channel

Find Out More:

retail inflation

Related Articles: