Now inflation falls to 5.5%; raises rate cut hope in Feb

Inflation falls below the central bank's upper tolerance level of 6%

- DIPAK MONDAL @ New Delhi

RETAIL inflation eased in November to 5.48% compared to 6.21% in October, giving a relief to both common man and policymakers, who have been struggling with the question of growth over inflation. Though the inflation has come down below the RBI's upper tolerance level of 6%, it is still higher than the targeted inflation of 4%.

The moderation in November inflation was mainly on account of 2.2% month-on-month decline in food prices. Though at 9.04% year-on-year growth, food inflation remained at higher levels. Food and beverages account for 45.86% weightage in the Consumer Price Index (CPI), which measures retail inflation.