Food prices Slashed for the fifth successive month |
Continuing the trend, food prices registered their fifth successive monthly decline in February. The fall is bound to put pressure on farm incomes, accentuating the agrarian crisis that could play an important role in the summer`s Lok Sabha elections. The Consumer Price Index (CPI) was reported to be 2.57% for February, 2019 against 1.97% in January 2019. However, food and beverage prices, which have a 46% weight in the total Consumer Price Index, registered a fall. This is the longest spell of a fall in food prices for the period covered by the new CPI series. The growth in food and beverages component of CPI has increased by 122 basis points between January 2019 and February 2019. There is also a rural-urban divide in the behaviour of food prices. While urban food inflation has been in positive territory for both January and February 2019, rural food inflation continues to be negative. The recovery in urban food prices was also reflected in the Wholesale Price Index (WPI) for primary food articles – a useful proxy for farm-gate prices – which registered positive growth in January 2019. after falling continuously between August 2018 and December 2018. The food inflation trends might have mixed political implications.
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