As per the government data that was released today, the retail inflation rate of the country rose to 5.03 percent in February 2021, mainly due to higher food prices. Food inflation rose steeply to 3.87 percent in February, compared to 1.89 percent in January.
The core inflation, which measures growth in the consumer price index after removing the food and fuel components stood at 5.8 percent as against 5.7 percent in the previous month.
Meanwhile, the Index of Industrial Production (IIP) contracted 1.6 percent for January 2021,
according to the data released by the Ministry of Statistics and Programme Implementation (MoSPI). The industrial output rose by 1 percent in December 2020 and grew by 2 percent in January 2020.
The manufacturing sector output contracted by 2.0 percent in January, while the mining output declined by 3.7 percent. Meanwhile, the power generation grew by 5.5 in January.
Within the food items, the rate of fall in vegetable prices was at 6.27 percent in February, as against 15.84 percent in the previous month.
Inflation in the 'fuel and light' category remained elevated at 3.53 percent during February compared to 3.87 percent in January.
The February CPI is the last CPI Inflation print before the RBI announces its revised monetary policy framework, reviewing its 4 +/-2 percent inflation band by the end of the month.
The Reserve Bank of India, which looks at the inflation levels in the economy while deciding on the key policy rates, suggested in a report on Currency and Finance 2020-21 that the current mandate of 2-6 percent inflation target for the monetary policy was appropriate and should continue for the next five years.
