Inflation over comfort range of 6%; no need for alarm: RBI

15/02/2022

286 1 minute read

Retail inflation rose to a seven-month high of 6.01 per cent in January, breaching the upper tolerance level of the medium-term inflation target of 4+/-2 per cent set by the Reserve Bank of India (RBI), data released by the National Statistical Office (NSO) recently showed.

Key Highlights

The rise was mainly on account of high food inflation, which jumped to a 14-month high of 5.43 per cent, along with an unfavorable base.
Inflation at the wholesale level in January softened to 12.96 per cent from 13.56 per cent a month ago but marked the tenth consecutive month of being in double digits, another set of data released by the Ministry of Commerce and Industry showed.
Wholesale food inflation was, however, at a 24-month high of 9.6 per cent. Wholesale Price Index (WPI)-based inflation rate is reflective of the price pressures on the inputs side and of manufacturers passing on the higher input costs to their output prices.
RBI Governor Shaktikanta Das said there was no need to panic on the inflation front. “Today’s inflation print is expected to be around 6 per cent. So that should not surprise or create any alarm, because we have taken that into consideration,” he said after the RBI board’s customary post-Budget meeting with Finance Minister Nirmala Sitharaman.
Last week, the RBI had projected India’s average inflation to soften to 4.5 per cent in 2022-23, down from an estimated 5.3 per cent in 2021-22.

SOURCE: The Indian Express