New Delhi: After the assembly elections of five states, the fears that were being raised about the rise in prices of petrol-diesel, cooking gas, CNG, and PNG, which were being feared to provoke inflation, finally proved to be true. From food items to fruits and vegetables, shoes and slippers, clothes all became expensive. This is the reason why retail inflation flared up to reach a 17-month high in March 2022.
This is the third consecutive month that retail inflation has remained above 6 percent. The Reserve Bank, while announcing its first monetary policy for the current financial year 2022-23, last week raised the inflation forecast to 6.3 percent in the first quarter, 5 percent in the second, 5.4 percent in the third quarter, and 5.1 percent in the fourth quarter. Was.
Retail inflation stood at 6.95 percent
According to government data released on Tuesday, the Consumer Price Index (CPI)-based retail inflation rose to 6.95 percent in March. This figure of retail inflation is the highest level in 17 months. This rate was recorded at 6.07 percent in February 2022 and 6.01 percent in January. Retail inflation was at 5.52 percent in March 2021. Inflation in food items increased from 5.85 percent to 7.68 percent in March 2022.
According to government data, there has been a tremendous increase in inflation in urban areas in the month of March. In February, retail inflation in urban areas was at 5.75 percent, which flared up to 7.66 percent in March. Whereas in rural areas this month the retail inflation rate was 6.12 percent.
Loans likely to get expensive
Even after the retail inflation reached this level in March, the possibility of it continuing to rise cannot be ruled out. In April also, the prices of petrol-diesel and natural gas have been increased, the effect of which is clearly being felt. When the April figures come in May, then the increase can be seen. This has increased the chances of all types of loans becoming expensive. That is, the era of cheap loans may end in the coming month because the Reserve Bank will be forced to increase the repo rate to control inflation. The interest rate of the loan is decided by the repo rate.
The rate of retail inflation is fixed on the basis of the prices of 299 goods including crude oil, commodity, and finished goods prices.
