The retail inflation spiralled to 7.35 per cent in December 2019 from 5.54 per cent in a month’s time. This spike has breached the Reserve Bank of India’s (RBI) upper-limit target (4 (+2).
This is the highest inflation rate recorded since July 2014 when it had peaked to 7.39 per cent.
The Consumer Price Inflation (CPI) or retail inflation figures were released by the National Statistical Office (NSO). The numbers indicate that inflation had hit a 40-month high of 5.54 per cent in November, triggering concerns over slowing economy.
The retail inflation based on Consumer Price Index (CPI) was 2.11 per cent in December 2018.
In December last year, the core inflation rate increased marginally to 3.7 per cent. The main concern is food inflation, which has spiked to 14.12 per cent in December from 10.01 per cent in November. Vegetable inflation during the same time also rose to 60.5 per cent in December from 36 per cent in November.
This comes as a big blow to the economy with the government projecting a 5 per cent growth – the lowest in 11 years.