Sign in Subscribe
Banking industry

Consumer Food Price Inflation Rises to 8.7% in November

Strategic Insights

— 2 min read

Consumer food price inflation surged to a three-month high of 8.7% in November 2023, driven by firming prices of vegetables, cereals, and pulses. This is a significant increase from the previous month's rate of 6.6% and a year-over-year increase from 4.6% in November 2022. The Reserve Bank of India (RBI) has set a target of keeping retail inflation within 4% with a margin of 2% on either side, and the current rate of 5.55% is within this comfort zone. However, the rise in food prices is a concern for policymakers, as the food basket accounts for about 50% of the Consumer Price Index (CPI).

Key Takeaways:

  • Consumer food price inflation rose to 8.7% in November 2023, a three-month high, driven by firming prices of vegetables, cereals, and pulses.
  • The inflation rate increased from 6.6% in the previous month and 4.6% in November 2022.
  • The RBI has set a target of keeping retail inflation within 4% with a margin of 2% on either side, and the current rate of 5.55% is within this comfort zone.
  • The food basket accounts for about 50% of the CPI, making it a crucial component of India's inflation.
  • Pulses prices surged to 20.23% year-on-year, while vegetables inflation reached 17.70% in November.
  • Cereals inflation remained stubborn at 10.27% in November, while meat and fish inflation fell to 2.15%.
  • Milk inflation dropped to 5.75%, and egg prices grew 5.90%.
  • Sugar and confectionary prices accelerated to 6.55%, while spices inflation slightly eased to 21.55%.
  • Oils and fats prices recorded a drop of 15.03% year-on-year in November.
  • The price data are collected from selected 1114 urban Markets and 1181 villages covering all States/UTs through personal visits by field staff.
  • The data collection process has a high response rate, with 99.9% villages and 98.6% urban markets reporting prices in November 2023.

Statistics:

  • Consumer food price inflation: 8.7% in November 2023
  • CPI: 5.55% in November 2023
  • RBI's target for retail inflation: 4% with a margin of 2% on either side
  • Food basket weightage in CPI: 50%
  • Pulses prices: 20.23% year-on-year in November
  • Vegetables inflation: 17.70% in November
  • Cereals inflation: 10.27% in November
  • Meat and fish inflation: 2.15% in November
  • Milk inflation: 5.75% in November
  • Egg prices: 5.90% in November
  • Sugar and confectionary prices: 6.55% in November
  • Spices inflation: 21.55% in November
  • Oils and fats prices: -15.03% year-on-year in November

Sources:

  • Ministry of Statistics & Programme Implementation (MoSPI)
  • Reserve Bank of India (RBI)
  • National Statistical Office (NSO)
  • Contify.com

Read more