Retail inflation falls to 3.34% in March from 3.61% in February

The retail inflation in India further eased to 3.34% in March, hitting its lowest level since August 2109, according to government data released on Tuesday.

The CPI inflation print for March came in below February's 3.61% and this is the second month consecutively that inflation has stayed under the Reserve Bank of India's 4% medium-term target.

How Were Prices Moderated?

The moderation in prices was led primarily by a steep drop in food inflation. On the basis of the All India Consumer Food Price Index (CFPI), the year-on-year inflation rate stood at 2.69% in March, as compared to 3.75% in February.

So far, this has been the lowest food inflation reading since November 2021.

Additionally, in rural areas, food inflation displayed a cooling trend. The headline inflation here also declined to 3.25% in March from 3.79% in February, while rural food inflation slid to 2.82% from 4.06%.

On the other hand, urban headline inflation inched up slightly to 3.43% from 3.32%. Food inflation in urban areas, however, also eased from 3.15% in February as compared to 2.48% in March, bringing relief to households in cities as well as towns.

In the housing segment, inflation increased up to 3.03% in March, compared to 2.91% in February.

Additionally, fuel and light inflation, which had been in the negative territory in February at -1.33% returned to positive ground at 1.48% in March.

Further, education inflation also rose marginally to 3.98% from 3.83%, while healthcare inflation rose to 4.26% from 4.12%. Transport and communication costs also saw an increase, rising from 2.93% to 3.30%.

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