India's Retail Inflation Breaches RBI's Tolerance Level, Rises to 6.52% in January due to Food Price Increase
India's retail inflation has risen to 6.52 per cent in January, breaching the Reserve Bank of India's tolerance level due to an increase in food prices. The Consumer Price Index-based inflation stood at 4.59 per cent in December 2020.
Purohit Vahini 
New Delhi : India's retail inflation has risen to 6.52 per cent in January, breaching the Reserve Bank of India's tolerance level due to an increase in food prices. The Consumer Price Index-based inflation stood at 4.59 per cent in December 2020. This surge in inflation is mainly due to the rise in food prices, with the food inflation rate standing at 14.87 per cent in January 2021. The cost of edible oils has increased by 20.30 per cent, and the cost of pulses has increased by 12.54 per cent compared to the previous year.
This increase in inflation could impact India's economy as high inflation rates may discourage consumers from spending and affect economic growth. The Reserve Bank of India had kept its key interest rates unchanged in its monetary policy review earlier this month, citing concerns about rising inflation. However, the central bank has also said that it is willing to provide additional liquidity to support the economy as it recovers from the pandemic.
The government may also need to take measures to curb the rise in food prices and bring down inflation. This could include steps such as increasing the supply of essential commodities, controlling hoarding and black-marketing, and improving infrastructure to transport food items.
