Bringing good news to the common man ahead of Diwali, the retail inflation dropped to 6.46% in September on falling prices of fruits and vegetables, the lowest since India started computing Consumer Price Index (CPI) in January 2012.
The overall food inflation measured on the Consumer Price Index (CPI) fell to 7.67% as against 9.35% in the previous month and 11.75% in September 2013.
CPI inflation is on the decline since July.
The retail inflation was at 7.73% in August, revised downward from the earlier estimate of 7.8%.
As per the data released by the Ministry of Statistics and Programme Implementation, the CPI inflation in vegetable basket in September fell to 8.59% as against 15.15% in the previous month.
Inflation in fruits slowed to 22.4% from 24.27% in August. Similarly price rise in protein rich items like eggs, fish and meat was slower in September as compared to August.
The data for inflation based on Wholesale Price Index will be released tomorrow. The WPI inflation in August was at 3.74%.
Lately, Reserve Bank has been mainly considering CPI inflation while deciding on its bi-monthly monetary policy. RBI has been targeting a retail inflation of 8% by March 2015 and 6% by March 2016.
In its last monetary policy, the RBI had maintained a status quo in interest rate citing worries on the inflation front despite industry demanding reduction.
The data further revealed that consumer inflation was 6.34% in urban India and 6.68% in rural parts of the country. The urban and rural inflation was at 7.04% and 8.27%, respectively in August.