November CPI to be a key data point for RBI monetary review

The numbers will be announced later today

The retail price index-based inflation for the month of November, slated to be released in the evening today, is keenly watched as it comes ahead of RBI monetary review next week and a few days after the Congress faced drubbing in assembly elections. It gains more significance because the drubbing was mainly on  the issue of price rise among other factors. RBI is expected to take  anti-inflationary stance as inflationary pressures have resurfaced.

In October, expensive vegetable prices had catapulted consumer price index (CPI)-based inflation to double digits after a gap of six months, even as normal monsoon is expected  to yield a bumper crop this financial year.

Vegetable prices have  abated a bit in November, but its exact impact on retail inflation would be known later in the day.  CARE Ratings chief  economist Madan Sabnavis pegged the inflation at 10% in November. If that be so, it would be the second month in a row to have a double-digit inflation.

The inflation had risen to 10.09% in October from 9.84% in Septem ber as the rate of price rise surged to 45.67% against 34.93%  over the  period.

Inflationary Headaches
	Oct,  12	Nov, 12	Dec, 12	Jan, 13	Feb, 13	Mar, 13	Apr, 13	May, 13	June, 13	Jul, 13	Aug, 13	Sep, 13	Oct, 13
CPI Inflation	9.75%	9.90%	10.56%%	10.79%	10.91%	10.40%	9.30%	9.31%	9.87%	9.64%	9.52%	9.84%	10.09%
WPI Inflation	7.32%	7.24%	7.31%	7.31%	7.28%	5.65%	4.77%	4.58%	5.16%	5.85%	6.10%	6.46%	7%
Note:Base year for CPI inflation is 2010 and that for  WPI  inflation is  2004-05
Source: Ministry of Statistics and Programme  Implementation and Department of Commerce

Both  urban  and rural areas had witnessed  double  digit inflation at 10.20% and 10.11% in October  respectively.  

Overall food and beverages inflation had soared to 12.56% against 11.44%  in September. With food items  having a weight  of more than 45% in CPI, this inflation surges whenever  food  prices rise. On the other  hand, food items have 24% weight in the wholesale price index  (WPI)  because  of which WPI inflation stood at 7%in October. Food inflation in wholesale price index remained over 18% for two months in a row-- September and October.  

Yesterday, Reserve  Bank  of India governor Raghuram Rajan had said  inflation has resurfaced. "We are one of the large countries  in the world with the highest CPI (Consumer  Price Index-based inflation)...," he had said. The RBI is slated to come  out with its review next  week .

Earlier on Sunday, Congress president Sonia Gandhi had  said price rise was an issue in elections.