Retail inflation in October accelerates at 3.58% on rising food prices

Recovering food prices lift retail inflation to a seven-month high in October

Inflation hits seven-month high of 3.58pc in October

However, on a year-on-year (YoY) basis, the CPI inflation last month was lower than 4.20 per cent recorded in October 2016.

CPI is the main price gauge that the Reserve Bank of India (RBI) tracks. Similarly, prices of pulses fell -23 percent, as compared with (-) 22.51 percent in September.

Food, fuel and housing prices pushed India's annual retail inflation rate higher in October, official data showed on Monday.

Consumer food price inflation, a metric to gauge changes in monthly kitchen costs, saw a jump, with prices rising 1.90 percent in October from 1.25 percent in September.

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According to the data furnished by the Ministry of Statistics and Programme Implementation, October's consumer price index (CPI) inflation rose to 3.58 per cent from 3.28 per cent in September. The cities have been the most hit as vegetables have costlier by 11.67 per cent, while villages have seen a rise of 5.23 per cent.

It has gone to seven months high level mainly due to higher prices of food and fuel.

The data comes at a time when analysts expect the GST Council decision on Friday to slash tax rates on 178 items to 18 per cent from 28 per cent could marginally lower retail inflation in coming months. Recently, the Goods and Services Tax (GST) Council, even after pruning the 28 per cent slab, chose to keep the above items in the top slab. "We continue to expect an extended pause amid non-unanimous voting by the MPC in the December 2017 policy review", said Aditi Nayar, an economist at ICRA.

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