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Data | Rice, wheat push up inflation, but Southern States keep prices low


Cereal inflation highest since 2014, West Bengal, Rajasthan and Uttar Pradesh cross the 15% mark

Cereal inflation highest since 2014, West Bengal, Rajasthan and Uttar Pradesh cross the 15% mark

After decelerating for 3 consecutive months, India’s retail inflation accelerated to 7% in August 2022. A significant component behind this uptick was a reversal in retail meals inflation which declined to six.7% in July however went up once more to 7.6% in August. In flip, the surge in meals inflation was because of rising cereal costs which quickened to 9.5% in August — the very best since February 2014.

Whereas total meals inflation was excessive, huge variations have been noticed throughout main States. Notably, the Southern States bucked the pattern and recorded very low ranges of meals inflation in August. Tamil Nadu, Andhra Pradesh, Kerala and Karnataka have been on the backside of the checklist when main States have been in contrast for retail meals inflation. The August meals inflation in these 4 States was 5% or much less. Meals inflation was decrease than the nationwide common in Telangana (6%) too.

In distinction, the western States of Gujarat (11.5%) and Rajasthan (10.4%) have been on the prime of the checklist with retail meals inflation of over 10% in August. The opposite States which had meals inflation greater than the nationwide common embrace West Bengal (10.3%), Uttar Pradesh (9.2%), Maharashtra, and Uttarakhand (8.5%).

Chart 1 exhibits India’s total retail inflation and meals and beverage retail inflation since 2019. The general retail inflation, after accelerating to 7.79% in April 2022, softened for 3 consecutive months. However the pattern reversed with retail inflation touching the 7% mark in August 2022. Within the case of meals and drinks retail inflation, after accelerating to eight.1% in April 2022 — the very best in 17 months — it softened for 3 consecutive months. However just like retail inflation, right here too the pattern reversed in August.

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Chart 2 plots item-wise retail inflation in August 2022 for all food-related merchandise on the vertical axis. The chart additionally plots the burden of these gadgets within the inflation calculation on the horizontal axis. The retail inflation of rice and wheat/wheat flour — from sources apart from PDS — which carries essentially the most weightage amongst food-related gadgets, accelerated to six.9% and 15.7% respectively in August 2022. In August, rice inflation was the very best in over 20 months whereas wheat/wheat flour inflation was the very best since at the very least January 2015. In truth, wheat/wheat flour inflation has surged this monetary yr, with every month recording over 9% of retail inflation.

Resulting from rising native costs, the federal government imposed an export ban on broken rice on September 9 and mandated an export responsibility of 20% on varied grades of rice. After the ban on wheat exports in mid-Could, the demand for Indian wheat flour surged pushing up the native costs. So, in late August, India imposed restrictions on wheat flour too, to rein within the costs.

Desk 3 exhibits State-wise meals & beverage retail inflation in August. The southern States of Tamil Nadu, Andhra Pradesh, Kerala, and Karnataka characteristic on the backside of the desk whereas Gujarat and Rajasthan are on the prime.

Desk 4 exhibits State-wise retail inflation in August 2022 for cereals, meat and fish, and greens — the three sub-groups which carry essentially the most weightage underneath the “meals and beverage” group. Apart from Kerala within the cereal sub-group, the southern States recorded low ranges of retail inflation throughout all three sub-groups. Within the cereal sub-group, Tamil Nadu, Telangana, and Karnataka recorded lower than 3% of retail inflation. Within the meat and fish sub-group, many Southern States recorded deflation. And within the vegetable sub-group, the inflation was 5% or much less in Karnataka, Andhra Pradesh, and Tamil Nadu.

Supply: MOSPI

Additionally learn: Data | Rural inflation peaks across States, except in Tamil Nadu and Kerala



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