Retail inflation declined to a five-month low of 4.85 per cent in March because of cooling food and fuel prices, according to official data released on Friday.

The Consumer Price Index (CPI) based retail inflation was 5.09 per cent in February and 5.66 per cent in March 2023. Previously, CPI-based inflation was the lowest at 4.87 per cent in October 2023.

The inflation in the food basket was at 8.52 per cent in March, down from 8.66 per cent in February, according to the data released by the National Statistical Office (NSO).

Aditi Nayar, chief economist, Icra said “the food & beverages inflation to remain above the 7 per cent mark in April 2024. An intensification of the impending heatwave may worsen the seasonal uptick in prices of perishables, heightening the criticality of a favourable monsoon in 2024 to keep food inflation in check and inflationary expectations well-anchored.”

“The ongoing uptrend in international crude oil prices could also pose a risk to the CPI inflation outlook in the near term, although the extent of the impact would depend on the pass-through to retail fuel prices, and the impact of such transmission would be relatively lesser compared to the WPI inflation given the different weights of fuel items in the CPI and the WPI baskets.”

IIP growth

India’s industrial production grew 5.7 per cent in February 2024, according to official data.

The factory output measured in terms of the Index of Industrial Production (IIP) witnessed a growth of 6 per cent in February 2023.

The data released by the National Statistical Office showed that the manufacturing sector’s output grew 5 per cent in February 2024, down from 5.9 per cent in the year-ago month. In February this year, mining production rose 8 per cent, and power output increased 7.5 per cent.