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Retail inflation jumps to 6.95% in March

NEW DELHI: Retail inflation based on consumer price index (CPI) accelerated to 6.95 per cent in March, data released by government showed on Tuesday.
In February, the inflation figure was an eight month high of 6.07 per cent.
The inflation in the food basket was 7.68 per cent in March, up from 5.85 per cent in the preceding month.
The Reserve Bank of India (RBI) mainly factors in retail inflation while arriving at its bi-monthly policy.
Reserve Bank’s monetary policy committee (MPC) has been tasked by the government to tame retail inflation based on consumer price index (CPI) at 4 per cent (+,-2 per cent).
This is the third straight month when the inflation figure has remained above the upper limit of RBI’s targeted range.
In the past few weeks, prices of vegetables and several other food items have gone through the roof. The rates of petrol and diesel have also increased by about Rs 10 per litre each in the past one month.
Besides, the prices of other petroleum products, including cooking gas, have also witnessed a rise in the past few days, adding to the woes of the people.
In the recently concluded meet of RBI’s MPC, retail inflation projection for the current financial year was raised to 5.7 per cent from earlier forecast of 4.5 per cent.
In wake of the ongoing Russia-Ukraine war, RBI governor Shaktikanta Das had said the prices of crude oil as well as edible oil will likely remain elevated.
Das said the heightened geopolitical tensions since end-February have upended the earlier narrative and considerably clouded the inflation outlook for the year.
Stating that a likely record rabi harvest would help to keep domestic prices of cereals and pulses in check, he said, global factors such as loss of wheat supply from the Black Sea region and the unprecedented high international prices of wheat could put a floor under domestic wheat prices.
(With inputs from agencies)

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