Good News For The Middle Class

wholesale inflation drops in February, food items get cheaper

• The wholesale inflation rate has dropped to 2.26 percent. The wholesale price-based inflation was 3.1% in January 2020. That was 2.59 percent in December 2019. Inflation based on wholesale price index was 2.93% in the same period of 2019. The middle class has been a big relief in February.
• The government released inflation figures on Monday, stating that the wholesale inflation rate has come down mainly due to the January rivalry of foodstuffs, which are cheaper in February. The biggest reason for the decline in inflation is the decline in prices of pulses and vegetables. But inflation in eggs and meat and fish has seen a slight rise in February.
• Eggs and meat-fish inflation rose to 6.88 percent from 6.73 percent. Inflation rate of potatoes also declined. The effect of this reduction in prices of vegetables is being seen as a reduction in the price of cereals. Inflation in pulses declined from 12.81 per cent to 11.42 per cent in February. During the week under review, the wholesale inflation of vegetables declined by 52.72 percent to 29.97.

Retail inflation also dropped

• last week by the government. Retail inflation eased to 6.58 percent in February, as grain prices dropped. Inflation based on Consumer Price Index (CPI) was 7.59% in January 2020. In February 2019, the figure was 2.57 percent. According to data from the National Statistics Office, inflation in the cereal sector declined to 10.81 percent in February 2020 from 13.63 percent in January.

RBI to review policy rates next month

• The Reserve Bank of India (RBI) will review key policy rates in its quarterly monetary policy review in April. The RBI aims to limit retail inflation to four percent. In those times, it is important for the government to present inflation figures. This is because inflation is a necessary factor in determining policy rates in the Reserve Bank's quarterly financial review. Let me tell you that at the planned quarterly meeting in February, the central bank decided to keep the repo rate unchanged, given the inflation rate.