According to the data by the National Statistical Office , ‘oils and fats’ prices zoomed 33.5 per cent while inflation in the fuel and light category rose to 13.63 per cent in October 2021.
Fruit prices increased by 4.92 per cent while vegetables prices dropped by 19.43 per cent and that of eggs declined by 1.38 per cent.
We expect this to be accompanied by a 15 bps hike in the reverse repo rate by the RBI.” Despite base effect, still-high fuel costs, input cost pressures and seasonal turn in some food prices in coming months could even see inflation rising towards 6.2 per cent plus later in the fiscal year, Madhavi Arora, Lead Economist, Emkay Global Financial Services said.
While the direct impact of the fuel price cut will be visible from November, its indirect impact in the context of pressure on producer margins, services inflation and the trajectory of oil and other commodity prices will also be important, Sreejith Balasubramanian, Economist Fund Management, IDFC AMC said.
The Reserve Bank, which mainly factors in CPI-based inflation while arriving at its bi-monthly monetary policy, has been tasked by the government to keep it at 4 per cent, with a tolerance band of 2 per cent on either side.