New Delhi: India’s retail inflation rose to a 10-month high of 3.21% in February from 2.74% in January, driven largely by higher prices of food, beverages and precious metals, according to official data released on Thursday by the Ministry of Statistics and Programme Implementation. The latest consumer price index (CPI) reading marks the fourth consecutive monthly increase in inflation and was broadly in line with economists’ expectations of around 3.1%.
Food inflation, which carries the largest weight in the CPI basket, accelerated to 3.47% year-on-year in February from 2.13% in January. Rural inflation rose to 3.37% from 2.73% in the previous month, while urban inflation increased to 3.02% from 2.75%. Despite the uptick, overall inflation remained below the RBI’s 4% medium-term target.
The latest inflation data comes amid rising geopolitical tensions involving Iran, Israel and the United States, which have raised concerns about potential disruptions to global oil supplies. Prolonged supply constraints could lead to imported inflation for energy-dependent economies such as India, particularly if crude prices remain volatile.
At the all-India level, several kitchen staples continued to record deflation. Garlic inflation stood at -31.09% in February, compared with -53.03% in January, while onion prices fell -28.20%, slightly narrower than the -29.30% contraction in the previous month. Potato prices also remained in negative territory at -18.46%, easing from a -28.98% decline in January.
Price pressures were also tracked across services and household categories under the revised CPI basket. Housing inflation rose marginally to 2.12% in February from 2.05% in January. Inflation in clothing and footwear stood at 2.81%, compared with 2.98% in the previous month. Inflation in restaurants and accommodation services eased to 2.73% from 2.87%, while health inflation moderated to 1.90% from 2.19%. Inflation in information and communication services edged up to 0.25% from 0.16%.
Among commodities, precious metals recorded sharp price increases. Inflation in silver jewellery stood at 160.84% in February, compared with 160.12% in January, while prices of gold, diamond and platinum jewellery rose 48.16%, up from 46.80% in the previous month.
The February data also comes under a revised CPI series with the base year changed to 2024 from 2012 to reflect shifts in consumption patterns.
(Cover photo by Adhitya Sibikumar on Unsplash)