Retail inflation, measured by Consumer Price Index (CPI) dropped to a one-year low of 3.31 percent in the month of October on the back of cheaper kitchen staples, fruits, and protein-rich items, official government data released on Monday showed. In Septemeber, CPI was at 3.7 percent and 3.58 percent in October 2017.
It is the lowest inflation since September 2017 when it touched 3.28 percent. The price of the food basket contracted by 0.86 percent in October compared to a 0.51 percent rise in September, as per the Central Statistics Office data. Its inflation was at 0.35 percent as against 1.12 percent recorded a month ago.
Prices of vegetables declined by 8.06 percent in October as against a 4.15 percent contraction in September. The retail inflation cooled among protein-rich items like cereals, eggs, milk and related products. However, inflation fastened to 8.55 percent for the 'fuel and light' category against 8.47 percent in the previous month.
At the present levels, inflation remains below the mid-point of the 4 (+/-2) percent target set for the country's Monetary Policy Committee. The MPC kept the benchmark repo rates unchanged in October, after raising it by 50 basis points in the previous two meets.
Index of Industrial Production (IIP) grew to 4.5 percent in September helped by good performance from the manufacturing sector and a higher offtake of capital goods and consumer durables.