India’s CPI inflation spikes to 14-month high of 6.2% in October

The Reserve Bank of India targets retail inflation at 4%, with tolerance level of two percentage points on either side.

On a sequential basis, inflation rose by 1.34% in October.

The inflation rate was driven by a sharp rise in food prices, with the Consumer Food Price Index (CFPI) reaching a provisional 10.87% in October, highlighting an intensified pressure on household expenses.

For rural and urban areas, CPI inflation came in at 6.68% and 5.62%, respectively, while food inflation was reported at 10.69% for rural areas and a higher 11.09% for urban areas.

The surge in food costs was primarily led by rising prices of essential items such as vegetables, fruits, and oils and fats, with top vegetables—tomatoes, onions, and potatoes—remaining costly throughout the month. Conversely, notable declines in inflation were observed in pulses, eggs, sugar, and spices.

Also read: The cookie crumbles, thanks to biting inflation

Housing inflation, reported only for urban areas, rose marginally to 2.81% in October from 2.72% in September. The All India Electricity Index showed an inflation rate of 5.45% for October, slightly up from September’s 5.39%.

Core CPI, which excludes the volatile food and energy sectors, rose to a 10-month high of 3.7% in October, up from 3.5% in September. While CNBC-TV18’s poll had suggested a stabilisation at 3.6%.

Economists project overall inflation to ease in November, aided by a favourable base effect and a recent softening in vegetable prices.