Retail inflation surges to 7.35% in December, above RBI's comfort level

New Delhi : Blame it on costly vegetables; the retail inflation has gone up to 7.35% in December 2019 from 5.54% in November, according to the latest released government data. Last year, it was 2.11% in December.

The vegetable inflation alone took a sharp hike of up to 60% as against 36% in November. As per the government data, the food inflation rose to 14.12% in December as against (-) 2.65% in the same month of 2018. It was 10.01% in November 2019.

The central government has mandates the Reserve Bank to keep the inflation under 4% with a safe margin of 2%.

The median forecast in the Reuters poll of nearly 50 economists predicted India's annual consumer inflation rose to 6.2% in December from November's 5.54%.

In wake of the rising inflations, the Reserve Bank of India did not change the interest rates in December following five cuts totaling 135 basis points earlier in the year.

The central bank will make its next interest rate decision on February 6, days after Finance Minister Nirmala Sitharaman presents the Union Budget.