Consumer prices rose by six per cent for entire India in February this year, against the average prices of 2010, slightly higher than in January. This is despite the fact that the prices rose at the same rate in urban India and in rural India in both the months.
However, this could not be termed as retail inflation, which could be known only from January, 2012. Inflation is calculated on the basis of year-on-year movement, but the monthly figures for last year is not known, since the index was launched last month only. However, if one looks at segmented figures for retail price inflation, it is clear that food inflation is coming down.
Inflation based on consumer prices for items consumed by agriculture and rural labours declined in February, unlike wholesale price inflation.
Inflation based on consumer price index of items consumed by agriculture labour (AL) and rural labour (RL) declined to 8.55 per cent each in February from 8.67 per cent and 8.69 per cent in the previous month, respectively.
The fall in inflation is caused by food inflation, since food items have more weight in retail price index, against wholesale price indices (WPI). Food items have over 65 per cent weight in these two retail price indices, against 14.34 per cent in WPI.
In fact, wholesale prices of food items also rose at less rate in February than January, but even then inflation rose to 8.31 per cent in February from 8.23 per cent a month ago.
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So far as larger consumer price index is concerned, it remained intact at 104 points for urban India and 107 point for rural India. If the whole of 2010 is taken as base prices, then vegetables declined sharpest in the month of February at all India level. In February the index for vegetables was 106 points in February against 129 in the previous month.
In urban parts, vegetable prices declined the most with the index standing at 101 points in February against 130 in January. The rural parts showed the index at 108 points and 129 points respectively.
On the other hand, fruits prices rose the sharpest by three points from 112 points to 115 points at national level. Here prices rose more in rural parts with the index standing at 117 in February against 114 in January. In urban areas, the index stood at 112 points and 110 points respectively.
Rest of the items remained range-bound, or did not show any movement at all.
The all-India index was highest at 108 points in Kerala and lowest at 102 points in Nagaland.
The behaviour of prices showed that now the government and RBI will have to shift its focus to controlling prices of manufactured items, while keeping an eye on food prices.