Impacted by note ban, retail inflation fell to multi-year low of 3.17 per cent in January mainly on account of declining prices of food items including vegetables and pulses.
Retail inflation, measured in terms of Consumer Price Index (CPI), was at 3.41 per cent in December.
Last month’s inflation, down from 5.69 per cent in January 2016, was lowest in at least over three years.
Inflation in vegetables continued in the negative zone at (-)15.62 per cent as against (-)14.59 per cent a month earlier, as per the data from the Ministry of Statistics and Programme Implementation.
In pulses and products category also, the rate of price rise was negative at (-)6.62 per cent.
Inflation in fruits was higher at 5.81 per cent, fuel and light at 3.42 per cent. The rate of price rise in meat and fish was 2.98 per cent.
Government’s sudden announcement on November 8, 2016 to abolish old Rs 500 and Rs 1,000 notes, nearly 86 per cent of the total cash in circulation, dented demand in the consumer segment.
Overall, Consumer Food Price Index was down at 0.53 per cent in January as against 1.37 per cent in December.
Rural retail inflation was at 3.36 per cent in January compared with 3.83 per cent preceding month. For urban sector, it was at stable at 2.90 per cent.