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India Retail Inflation Rises to 3.21% in February Amid Global Oil Concerns
Retail Inflation: Will the Iran-Israel war further increase inflation in India? Find out why the retail inflation rate reached 3.21% in February. What impact could the current global situation have on the common man's pocket? Read the full report.
India has some more worrying news in a tougher geopolitical situation in West Asia and a shaky global trade scenario. The retail inflation has risen to 3.21% in February. This is happening in a situation where there is a dispute between Iran, Israel, and the US regarding oil supplies to the world.
The retail inflation or CPI has risen from 2.75% in January to 3.21% in February. The increase is more in rural areas than in cities. The rural inflation is 3.37% and urban inflation is 3.02% in February. The only consolation is that this is still within the target set by the RBI of 4%.
According to government data, food inflation is the biggest driver of rising inflation in the country. Food inflation rose sharply to 3.47% in February, up from 2.13% in January. Living and eating are becoming increasingly expensive for the common man. Housing inflation rose from 2.05% to 2.12%. Inflation in the fuel and light category was 0.14%. Healthcare inflation fell from 2.19% to 1.90%. Clothing and footwear inflation also declined from 2.98% in January to 2.81%.
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The Iran crisis has affected the movement of merchant ships near the Strait of Hormuz, through which approximately 20% of the world's oil trade passes. Economists believe that prolonged supply disruptions will increase the risk of imported inflation in energy-dependent countries like India. According to Aditi Nayar, chief economist at ICRA, if crude oil prices rise by 10%, directly affecting retail petrol and diesel prices, retail inflation could rise by 0.40% to 0.60%.
