Retail inflation surged to 7.35 per cent, way above the comfort zone of the RBI's Monetary Policy Committee target of 4 per cent.The retail inflation based on Consumer Price Index (CPI) was 2.11 per cent in December 2018 and 5.54 per cent in November 2019.
According to data released by the Government, food inflation rose to 14.12 per cent in December as against (-) 2.65 per cent in the same month of 2018. It was 10.01 per cent in November 2019.
The central government has mandated the Reserve Bank of India to keep inflation in the range of 4 per cent with a margin of 2 per cent on the either side.
Today's reading may prompt the Reserve Bank of India to hold interest rates steady, in the next polisy meeting to be heldd in Feb 2020.