Wednesday, February 29, 2012

First Nationwide Annual India Consumer Price Index released by the Centre of Statistical Office

As per the first nationwide retail inflation data released by the Centre of Statistical Office on 21 February 2012, inflation based on the all India Consumer Price Index stood at 7.65 per cent in January 2012. The annual consumer price index (CPI) data released for the first time measures retail prices in major food groups, fuel, clothing, housing and education across rural and urban India.

While food and beverages reported a moderate rate of price rise of 4.11 per cent year-on-year in January, the inflation numbers for fuel and light, and clothing, bedding and footwear segments were in double-digits. Overall retail inflation in rural and urban areas stood at 7.38 per cent and 8.25 per cent in January, respectively.
Consumer price inflation for rural India (CPI-R) was recorded at 7.38%, for urban India (CPI-U), it stood at 8.25%.

Inflation as measured by the WPI eased to a 26-month low of 6.55% in January 2012.

Beginning 21 February 2012, the union government will release the nation-wide Consumer Price Index (CPI) on a monthly basis for better reflection of retail price movement as well as help the Reserve Bank take effective monetary policy steps to tackle inflation. The new CPI will eventually replace the Wholesale Price Index (WPI) for policy actions to deal with the price situation.

The monthly CPI will exist in addition to the three retail price indices- for agricultural labourers, rural labourers and industrial workers prepared by the Ministry of Labour. The new nationwide CPI is to be prepared by the Ministry of Statistics and Programme Implementation (MOSPI).

CPI uses defined basket of goods and services that represents purchasing pattern of a particular household. As the pattern is driven from the consumption side, it provides a relatively realistic view on how consumers are affected. The CPI data is reliable indication of demand side pressures and inflation is received from utilising CPI as a measure.

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