April Respite: Retail Inflation Slides to 3.16%

Sharp drop in prices of vegetables and pulses cools food inflation to 42-month low

- SHIVA RAJORA

India's retail inflation moderated further in April to 3.16 per cent from 3.34 per cent in March, aided by a double-digit dip in vegetable prices and the deepest decline in pulses prices in over six years, offering more room for the central bank's Monetary Policy Committee (MPC) to prioritise growth over inflation in its upcoming review beginning June 4.

The last time the Consumer Price Index (CPI) had reported this mild an uptick was in July 2019—at 3.15 per cent. Data released by the National Statistics Office (NSO) on Tuesday showed retail prices rose 2.92 per cent in rural India, and 3.36 per cent in urban areas, but food inflation was milder in cities at 1.64 per cent, while it was 1.85 per cent in the hinterland.

While overall food inflation fell to a 42-month low of 1.78 per cent in April from 2.69 per cent in March, this was mainly driven by an 11 per cent year-on-year drop in vegetables prices, and a 5.23 per cent fall for pulses. Spices and meat, which together have a 7.5 per cent weightage in the CPI, saw prices drop 3.4 per cent and 0.35 per cent, respectively.