In fact, onions had seen a price fall of 7.42 per cent in July.
“The sharp jump in the CPI inflation
rate in September was single-handedly driven by food items, a portion of which is likely to prove temporary, even as all of the other major categories recorded a moderation in inflationary pressures,” said Aditi Nayar, principal economist at ICRA.
Madan Sabnavis, chief economist at CARE Ratings, said any increase in the CPI inflation
rate from now on should mean that the accommodative stance of the RBI has to change. RBI’s monetary policy committee had cut the policy rate for the fifth consecutive time earlier this month to propel the economic growth rate, which fell to 5 per cent in the first quarter of 2019-20.
Though the food inflation
moderated a bit in the WPI, it still remains elevated at 7.47 per cent in September. It was 7.67 per cent in August. Here as well, onions saw inflation rate jumping to 122 per cent from 33 per cent in this period.
The two other broad categories of fuel and light and manufactured items saw prices falling in the WPI, which was partly due to international factors and subdued demand. In the CPI also, the fuel and light category continued to see deflation. The deflation rate, in fact, rose to 2.18 per cent in September from 1.70 per cent in the previous month.
After remaining steady in July-August 2019, the core CPI inflation eased to a 26-month low of 4.2 per cent in September 2019, offering some relief in light of the significant uptick in headline inflation. Health services in the CPI continued to see the inflation rate above seven per cent though it moderated to 7.66 per cent from 7.84 per cent.