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The retail price index-based inflation for the month of November, slated to be released in the evening today, is keenly watched as it comes ahead of RBI monetary review next week and a few days after the Congress faced drubbing in assembly elections. It gains more significance because the drubbing was mainly on the issue of price rise among other factors. RBI is expected to take anti-inflationary stance as inflationary pressures have resurfaced.
In October, expensive vegetable prices had catapulted consumer price index (CPI)-based inflation to double digits after a gap of six months, even as normal monsoon is expected to yield a bumper crop this financial year.
Vegetable prices have abated a bit in November, but its exact impact on retail inflation would be known later in the day. CARE Ratings chief economist Madan Sabnavis pegged the inflation at 10% in November. If that be so, it would be the second month in a row to have a double-digit inflation.
The inflation had risen to 10.09% in October from 9.84% in Septem ber as the rate of price rise surged to 45.67% against 34.93% over the period.
| Inflationary Headaches | |||||||||||||
| Oct, 12 | Nov, 12 | Dec, 12 | Jan, 13 | Feb, 13 | Mar, 13 | Apr, 13 | May, 13 | June, 13 | Jul, 13 | Aug, 13 | Sep, 13 | Oct, 13 | |
| CPI Inflation | 9.75% | 9.90% | 10.56%% | 10.79% | 10.91% | 10.40% | 9.30% | 9.31% | 9.87% | 9.64% | 9.52% | 9.84% | 10.09% |
| WPI Inflation | 7.32% | 7.24% | 7.31% | 7.31% | 7.28% | 5.65% | 4.77% | 4.58% | 5.16% | 5.85% | 6.10% | 6.46% | 7% |
| Note:Base year for CPI inflation is 2010 and that for WPI inflation is 2004-05 | |||||||||||||
| Source: Ministry of Statistics and Programme Implementation and Department of Commerce | |||||||||||||
Both urban and rural areas had witnessed double digit inflation at 10.20% and 10.11% in October respectively.
Overall food and beverages inflation had soared to 12.56% against 11.44% in September. With food items having a weight of more than 45% in CPI, this inflation surges whenever food prices rise. On the other hand, food items have 24% weight in the wholesale price index (WPI) because of which WPI inflation stood at 7%in October. Food inflation in wholesale price index remained over 18% for two months in a row-- September and October.
Yesterday, Reserve Bank of India governor Raghuram Rajan had said inflation has resurfaced. "We are one of the large countries in the world with the highest CPI (Consumer Price Index-based inflation)...," he had said. The RBI is slated to come out with its review next week .
Earlier on Sunday, Congress president Sonia Gandhi had said price rise was an issue in elections.
