Government data shows retail inflation drops to a 15-month low of 5.66%. (GS – 3)
- India’s consumer inflation in March was 5.66%, the lowest in 15 months, compared to a rise of 6.44% in February.
- This was the first time in three months that the headline Consumer Price Index came within the 6% limit.
- The Reserve Bank of India’s targeted inflation rate is 4(+/-2)%.
- Food inflation was 4.79% in March, down from 5.95% in February, while core inflation eased to 5.95% from 6.23%.
- To control inflation, the Reserve Bank of India has raised the key lending rate by 250 basis points since May 2022.
- Cereal inflation remained high at 15.27% in March, while milk and milk items grew by 9.31% and vegetable inflation shrunk by 8.51%.
- Rural inflation was at 5.51% and urban inflation was at 5.89% in March.
- Central banks typically raise the repo rate to shrink money supply in the economy to bring prices under control during high inflation.
