Higher Food Prices drive up the retail inflation
The headline CPI inflation (combined) for March 2014 accelerated to 8.31% (y-o-y) from a 25-month low of 8.03% in February 2014, driven by higher food prices. The index increased to 138.1 from 137.3 seen in February and 127.5 March 2013. The rise in index of food category, especially vegetables and fruits pushed the CPI inflation up.The rising food prices inched up the combined CPI growth to rise above 25 months low in the previous month. The vegetables prices on monthly basis rose to 1.36% from a fall of 6.51% in February. Also the prices increased to 16.80% (y-o-y) in March from 14.29% in February 2014. Along with vegetables, fruits index also increased to 17.19% from 16.08% in February 2014.
CPI inflation in protein-rich items such as eggs, fish and meat increased to 9.54% in March from 9.47% in February. The rate of price rise for cereals and related products slowed to 9.61% in March from 9.85%. However, the price of milk and its products increased 11.02% in March compared with 10.22% in the previous month. Prices of condiments and spices rose 8.87% from 8.48% in February. Meanwhile, the fuel and light category saw a rise of 6.29%.
Meanwhile, the price rise of clothing, bedding and footwear products eased slightly from 9.07% in February to 9.03% in March.
The rate of price rise in rural area increased to stand at 8.89%, substantially down from 8.43% in February. While in urban areas, the inflation eased to 7.51% from 7.55%.
In combined CPI some of the biggest m-o-m rise was registered by fruits (3.01%), vegetables (1.36%) and milk and products (0.95%), leading to a rise in Food, beverages and tobacco category at 0.64%. Housing category also saw a rise of 0.73%. In the urban areas for March also, the biggest m-o-m rise was seen under vegetables (1.01% after rising to 0.94% in February), and fruits saw the rise (1.04%). Moreover, in the rural areas also for March, the categories recorded rise on m-o-m basis including vegetables (1.30%, after falling to 6.61% in February), and oils and fats (0.21%), leading to a rise in Food, beverages and tobacco category at 0.71%, after falling to 0.50% in February.
For March 2014, the state wise biggest uptick, in the rural segment, was noted by Tripura (2.43%, m-o-m) followed by Meghalaya (2.07% m-o-m) while biggest fall was recorded in Dadra and Nagar Haveli (0.81% m-o-m). For March 2014, the state wise biggest upside, in the urban segment, was noted by Meghalaya (1.57%, m-o-m), while the biggest fall was noted by Andaman & Nicobar Islands (0.37% m-o-m).
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