- According to the data released from the Central Statistics Office (CSO), retail inflation for the month of January has declined to 2.05%. This decline has been primarily due to a) sustained decline in food prices and b) a sharp decline in energy prices.
- It is based on the Consumer Price Index (CPI). It reflects changes in the retail prices of specified goods and services over a time period which are traded by particular consumer group. There are four types of CPI: a) CPI-IW (Industrial Worker), b) CPI-UNME (Urban Non-Manual Employees), c) CPI-AL (Agricultural Labourers) and d) CPI-RL (Rural Labourers)
- RBI has adopted CPI as the key measure for determining inflation situation of Indian economy, on recommendation of Urjit Patel Committee.
- The Core Inflation has also declined to 5.4%. Core inflation demonstrates inflation apart from temporary shocks and volatility. It is measured using the CPI by excluding food and fuel components as their prices are highly volatile.
- Industrial output growth as measured by the Index of Industrial Production (IIP) has remained low at 2.4%. IIP is a composite indicator that measures changes in the volume of production of a basket of industrial products.
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