Increasing policy challenges

RBI should not digress from maintaining price stability

Inflationary pressures are rising once again. The inflation rate based on the consumer price index went up to 5.03 per cent in February, against 4.06 per cent in the previous month. The wholesale price index-based inflation rate increased to a 27-month high of 4.17 per cent. While the headline numbers may not look particularly worrying at this point, the underlying conditions could make policy choices more difficult for the Reserve Bank of India (RBI). Core inflation remained elevated and increased to about 6 per cent in February — the highest since November 2018. It is now being driven by transportation