India's Retail Inflation Steady, Industrial Output Slows
Despite marginal increases in food prices, CPI remains at 5.09%. Industrial output expands by 3.8% in January, with manufacturing sector growth slowing to 3.2%
New Delhi: Staying almost flat, India’s headline retail inflation stood at 5.09 per cent in February compared to 5.1 per cent January despite having a marginal hike of food and vegetable prices, while industrial output in the country witnessed an expansion of 3.8 per cent in January against 4.24 per cent growth in December and 5.8 per cent a year ago, the two separate government data showed on Tuesday.
As per the data released by the National Statistical Office (NSO), inflation-based on the Consumer Price Index (CPI) was at 5.1 per cent in January this year, while it was 6.44 per cent in February 2023. Remaining almost unchanged at 5.09 per cent in February, retail inflation stayed at the Reserve bank’s tolerance band of 4 per cent with a margin of 2 per cent on either side. Last month, the central bank projected the CPI inflation at 5.4 per cent for the current fiscal and recorded at 5 per cent in January-March quarter.
The data, however, showed that the rural inflation remained unchanged at 5.34 per cent, while the urban inflation rate declined to 4.78 per cent from 4.92 per cent in January. “The food inflation for February stood at 8.66 per cent versus 8.30 per cent recorded in January. The vegetable inflation surged to 30.25 per cent from 27.03 per cent in January. In addition, the fuel and light inflation witnessed a contraction of (-) 0.77 per cent as against a contraction of (-) 0.60 per cent,” the data showed.
Meanwhile, another government data showed that India’s industrial production growth stood 3.8 per cent in January 2024 from 4.24 per cent growth in December, while it was 5.8 per cent in January 2023. “The manufacturing sector’s growth slowed to 3.2 percent from 4.5 per cent a month ago, even as the uptick in mining and electricity generation accelerated to 5.9 per cent and 5.6 per cent, respectively,” it showed.
The data further showed that the production of consumer durables jumped 10.9 per cent, the highest in three months. “However, consumer non-durables output shrank 0.3 per cent, marking the second year-on-year drop in production levels in three months. The production of capital goods picked up pace to grow 4.1 per cent in January, and intermediate goods also grew faster at 4.8 per cent. The growth rates for primary goods and infrastructure/construction goods, however, eased to 2.9 per cent and 4.6 per cent, respectively in January,” it showed.