The RBI also takes into account the retail inflation data while deciding on policy rates in the monetary policy.
Retail Inflation November 2020: The retail inflation (CPI) moderated to 6.93 per cent in November. The CPI-based inflation was at 7.61 percent in October last month. According to the statistical ministry, the inflation rate for food items has come down to 9.43 percent from 11 percent in October last month. Although retail inflation of vegetables remains. Retail prices of vegetables increased by 15.63 percent. Retail inflation in all the states of the country remains below 10 percent. The highest inflation rates were recorded in West Bengal and Andhra Pradesh.
The Reserve Bank also takes into account the retail inflation rate while making any decision on the policy rates in the Monetary Policy. The November data may play a key role in the upcoming RBI policy decisions. Higher inflation has an impact on the income of common people, even if there is a period of boom in the economy.
Wholesale inflation on top of 9 months
On the other hand, wholesale inflation was recorded at the top of 9 months in November 2020. In November, the wholesale inflation has increased by 1.55 percent on a monthly basis. Last month, the wholesale inflation was 1.48 percent. During this time, the prices of manufactured products have increased significantly. WPI: Wholesale inflation highest in 9 months; Prices of food and drink decreased, but they became expensive
Source: www.financialexpress.com