Retail inflation falls to 4-month low of 5.22%

CREATES ROOM FOR RBI'S RATE CUT

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Retail inflation in India dropped to a four-month low of 5.22 per cent in December, primarily driven by a decline in food prices, including vegetables, according to government data released on Monday. The dip provides the Reserve Bank of India (RBI) some flexibility to consider reducing the key interest rate in upcoming monetary policy reviews.

The Consumer Price Index (CPI)-based inflation moderated for the second consecutive month after breaching the RBI's upper tolerance limit of 6 per cent in October. December's inflation rate marked a decline from 5.48 per cent in November and 5.69 per cent in the same period last year.