India's retail inflation eases to 5.5% in November from a 14-month high

India’s retail inflation cooled a bit to 5.5% in November from a 14-month high of 6.2% in October but remained significantly elevated for rural consumers at 5.95%, while it dropped to 4.8% for their urban counterparts.

Food inflation eased a tad from October’s 15-month peak of 10.9% to 9.04% in November, with rural consumers experiencing a slightly higher uptick of 9.1% while urban consumers experienced an 8.74% gain in prices. This marks the third straight month of 9%-plus food inflation and overall consumer price rise of over 5%.

On a month-on-month basis, the Consumer Price Index was 0.15% lower than in October and the Food Price Index was down 0.6%, with urban consumers witnessing higher relief.

“The decline in inflation in November 2024 is mainly due to the decline in inflation in the ‘food & beverages’ group,” the National Statistics Office said, pointing to a significant drop in price rise observed in vegetables, pulses, sugar, fruits, eggs, milk, spices, transport & communication, and personal care & effects.

On the other hand, the highest inflation at an all-India level in November was recorded in garlic (85.14%), potato (66.65%), cauliflower (47.7%), cabbage (43.58%) and coconut oil (42.13%).

Vegetable inflation eased from a 57-month high of 42.2% in October to 29.33%, but oils and fats inflation shot up 13.3%, the highest pace in about two years and significantly over the 9.5% rise in the previous month and the mere 2.5% inflation in September.

Fruits inflation eased only marginally from 8.4% in October to 7.7% in November, while pulses inflation dropped to 5.4%, the lowest in at least two years, and cereals inflation stood at 6.9%.

Personal care and effects inflation remained elevated at 10.4%, though it was a tad lower than the 11% surge recorded in October.

Six of the 22 States (including the erstwhile State of Jammu and Kashmir), for which the NSO calculates monthly inflation rates, had observed a price rise of over 6% - that is the upper limit of the central bank’s inflation target - in November. These included Chhatisgarh (8.4%), Bihar (7.55%), Odisha (6.8%), Uttar Pradesh (6.6%), Kerala (6.3%) and Madhya Pradesh (6.05%).

Delhi recorded the lowest inflation of 2.65%, but was the only one to record a price rise below the Reserve Bank of India’s median inflation target of 4%.

Of the other 15 States, just four saw inflation in the range of 4% to 5% — Telangana (4.2%), Punjab and Rajasthan (4.7% each) and Maharashtra (4.81%), while the rest reported a price rise pace between 5% and 6%.