First inflation readings under the revised CPI framework comes in at 2.75%, with food inflation at 2.13 percent, as MoSPI expands market coverage & updates consumption weights.
New CPI series will take 2024 as base year, will provide more accurate measure of inflation, spending on digital services. Expected to enhance representation and reliability, says Saurabh Garg.
Household Consumption Expenditure Survey shows urban-rural gap has narrowed, particularly at lower levels of consumption, implying effectiveness of govt policies in improving rural incomes.
RBI has retained its inflation projection at 5.4% for the current year. Uncertainties in food prices and volatility in global crude oil prices continue to keep 4% target out of reach.
Indian Council of Applied Economic Research study says bans on export of wheat & rice were ‘knee-jerk’ reactions. Govt should adjust its trade policy, not sell at prices lower than MSP.
Food has an outsized weightage in Consumer Price Index, but education and health too little. This is because CPI is based on spending patterns of 'average Indian' from 12 years ago.
Food price hike driven by higher rates of vegetables, pulses & their products, spices, eggs, meat and fish. While jump in vegetable prices expected, inflation in cereals & their products worrying.
Factors like unfavourable weather, uncertainty over oil prices, demand from China’s re-opening & intensification of geo-political conflicts could pose upside risks to inflation outlook.
Contrary to naysayers, the RSS practices what it preaches. It is closer to the Gandhian teaching of improving the individual morally and spiritually to change the external environment.
This is the game every nation is now learning to play. Some are finding new allies or seeing value among nations where they’d seen marginal interest. The starkest example is India & Europe.
COMMENTS