Fear factor: The Hindu Editorial on the inflation battle
The HinduInflation faced by consumers eased to 5% in September, bringing some relief after a sharp rally in prices that began with July’s 15-month high inflation rate of 7.44%. So, September’s 5% inflation, which was partly aided by base effects from 2022 when the inflation pace was 7.4% and partly by a sharp dip in volatile prices of tomatoes and vegetables, with a little help from the Centre’s LPG price cuts, is unlikely to sustain or cool further. Although food inflation which had spurred the spike in prices through July and August, has eased to 6.6% in September, this was disproportionately influenced by crashing vegetable prices even as the inflation pace accelerated for pulses, fruits, eggs and sugar. Rural inflation remained higher than that faced by urban consumers, and with the erratic monsoon hurting kharif season sowing in crops like pulses and uncertainties about the El Niño effects on the rabi crop, weak rural demand as well as food price pressures remain a source of concern for the economy.