CPI cools down further in January to 3.17%

Consumer Price Index (CPI), or retail inflation, for the month of January stood at 3.17% said Ministry of Statistics and Programme Implementation (MOSPI) on Monday. 

In the month of December, CPI had eased to 3.41%, which was below the Reserve Bank of India's March-end 2017 target of 5% and medium-term target of 4%.

The Rural CPI for the month of January stood at 3.36%, while the Urban CPI stood at 2.9%.

All India Inflation rates (%) based on CPI (General) and CFPI

Notes: Prov.  – Provisional, Combd. - Combined

Consumer Food Price Index (CFPI) for the month of January stood at 0.53%.

source: tradingeconomics.com

The prices of vegetables and pulses declined the most during the month of January from December.

Monthly changes (%) in All India CPI (General) and CFPI: Jan. 2017 over Dec. 2016

Note: Figures of January 2017 are provisional.

According to a Bloomberg poll, analysts had predicted CPI to be at 3.24% from 3.41% a month before. However, a Reuters poll of 26 economists estimated the inflation to be slowed to 3.22% in January, which would be the lowest in the index's five-year history.

Since November, when in a surprise move, the government had ban Rs 500 and Rs 1000 notes,  the consumer price inflation has been below 4%. 

During April-December, retail inflation averaged 4.9% and displayed a downward trend since July when it became apparent that kharif agricultural production in general, and pulses in particular would be bountiful, the Economic Survey for 2016-17 had stated.