Retail inflation slowed to 5.48 percent in November compared to 6.21 percent in October, mainly due to easing food prices, especially vegetables, according to government data released on December 12. The latest figures are well withing the RBI’s upper tolerance level of 6 percent. 

“During the month of November 2024, a significant decline in inflation is observed in vegetables, pulses and products, sugar and confectionary, fruits, eggs, milk and products, spices, transport and communication and personal care and effects subgroups,” the NSO said in a statement. 

According to Consumer Price Index (CPI) data released by the National Statistics Office (NSO), the inflation in the food basked reduced to 9.04 percent in November. It was 10.87 percent in October and 8.70 percent in November 2023. 

Retail inflation has remained stubbornly high with prices of food items playing havoc and has often breached the RBI Monetary Policy Committee’s tolerance band of 2 percent to 6 percent. In October, retail inflation came in at a surprising 14-month high of 6.21 percent with vegetable inflation at a 57-month high of 42.2 percent. 

Last week, the Reserve Bank raised the inflation projection for the current fiscal to 4.8 percent from 4.5 percent. It also said that the lingering food price pressures are likely to keep headline inflation elevated in the December quarter. 

Consumer price index (CPI)-based headline inflation increased from an average of 3.6 percent during July-August to 5.5 percent in September and further to 6.2 percent in October 2024. 

In October, inflation rose to 6.2 percent, surpassing the Reserve Bank of India’s (RBI) upper tolerance threshold of 6 percent. This marked the first time in 14 months, since August 2023, that inflation exceeded this level. The increase was primarily driven by higher food prices, particularly in vegetables. 

Meanwhile, the statistics ministry data showed that factory output, as measured by the index of industrial production (IIP), rose 3.5 percent year-on-year (y-o-y) in October 2024. The manufacturing sector’s output grew 4.1 percent against 10.6 percent in the year-ago month. In the April-October period, the IIP grew 4 percent, down from 7 percent in the year-ago period.