New Delhi. After retail inflation hit an eight-year high, wholesale inflation has hit a 24-year high. Retail inflation reached a record high of 15.08 per cent in the month of April. Wholesale inflation has crossed 15 per cent for the first time since December 1998. The rate of wholesale inflation has increased substantially due to increase in the price of food items as well as petroleum products and electricity. Wholesale inflation has remained in double digits for more than a year now.
It is worth noting that in the concern of rising inflation, the Monetary Review Committee of the Reserve Bank of India held an emergency meeting and cut the policy interest rate in the past. To curb inflation, the Reserve Bank had increased the repo rate by 0.40 percent and also increased the cash reserve ratio (CRR). Through this, the Reserve Bank reduced the availability of cash in the market to contain inflation. Despite this, it is believed that policy interest rates may increase again next month.
However, for the last 13 months, the wholesale inflation has remained in double digits. It reached 15.08 percent in April. Earlier in December 1998, the wholesale inflation rate was 15.32 per cent. In the last two months, there has been a big increase in wholesale inflation. Wholesale inflation was 14.55 per cent in March 2022 and 13.11 per cent in February a month before that. In this way, there has been an increase of two percent in two months.
Inflation is increasing due to increase in the prices of food items and petroleum products. Inflation in food items stood at 8.35 per cent in April. In March 2022, it was 8.06 per cent. Crude oil prices have risen sharply since the outbreak of the Russo-Ukraine war in February, which was reflected in the elections in India that ended in March. From 22 March to the first week of April, there was a big increase in the prices of petroleum products.
Apart from petroleum products, the inflation rate of manufactured goods has also increased. Its inflation rate was 10.85 percent in April, which was 10.71 in March 2022. Prices of vegetables, wheat, fruits and potatoes rose sharply in April on a year-on-year basis, driving food inflation to 8.35 per cent. A few days ago, the government had released the rate of retail inflation, which has reached 7.79 percent. This is the highest rate in eight years.
