Winning Bizness Desk

Mumbai. There is news of some relief to the countrymen who are facing the brunt of inflation. The retail inflation rate has come down to 4.70% in April. The inflation rate in March was 5.66%. This is the third consecutive month when the inflation rate has come down. Not only this, this is also the lowest level of retail inflation since October 2021. Then the country's retail inflation rate had reached 4.5%. There has been a decline in retail inflation due to a fall in the prices of food articles, and a decline in the cost of electricity and fuel. There has also been a softening in the prices of vegetables. Food items account for about half of the basket of the Consumer Price Index (CPI). The inflation rate in February was 6.44%, which was more than the tolerance level (2-6%) of the Reserve Bank. At the same time, the inflation rate had reached 6.52% in January. For the last 2 months, the retail inflation rate has remained within the tolerance level of RBI and has come down significantly from the upper level. The inflation rate was 4.91% in November 2021 and 5.66% in December 2021. On the other hand, talking about the food inflation rate, it has come down to 3.84% in April 2023. It was 4.79% in March.

Good sign for the economy

Regarding the decline in inflation, experts say that this is good news for the poor. A fall in inflation means that the rate of price rise is declining. These are good signs for the economy. Improvement in supply chain and relief in commodity prices have also benefited. RBI's monetary policy meeting will be held from June 6 to 8 next month. On June 8, RBI will announce the decision of its meeting. If all is well on the inflation front, then cheap loans can be expected.

How does inflation affect?

Inflation is directly related to purchasing power. For example, if the inflation rate is 7%, then Rs 100 earned will be worth only Rs 93. That's why investing should be done keeping in mind inflation. Otherwise the value of your money will decrease. As a consumer, you and we buy goods from the retail market. The Consumer Price Index i.e. CPI does the work of showing the changes in the prices related to it. CPI measures the average price we pay for goods and services. Apart from crude oil, commodity prices, and manufacturing cost, there are many other factors which play an important role in determining the retail inflation rate. There are about 300 items on the basis of whose prices the rate of retail inflation is fixed.