The National Statistical Office (NSO) did not release an overall consumer inflation reading for a second straight month, due to the countrywide lockdown starting March 25 to curb the spread of the coronavirus pandemic.The government said it was putting off the release of consumer price inflation readings for April and May, a period that include a more-than two-month lockdown imposed to combat the coronavirus pandemic, due to inadequate data collection. However, limited data showed that annual retail food inflation eased to 9.28 per cent in May, from 10.5 per cent in the previous month.
The headline numbers for retail inflation for April and May and industrial output for April were not released “in view of the continued limited transactions of products in the market” during the lockdown and problems in collecting of adequate data, the National Statistical Office (NSO) said in a statement.
Normally, the government releases provisional consumer inflation figures for the previous month, along with the final figures for the month before, in the second week of a month.
The price collection of CPI via personal visits was suspended with effect from March 19. In May, data was collected through personal visits of field staff to the extent feasible and through telephone calls from designated outlets in select markets, the statistics office said.
According to a poll of 35 economists by news agency Reuters, consumer inflation was expected to have moderated to a six-month low of 5.50 per cent in May.
Official statistics for April were not published last month because of the coronavirus-triggered lockdown, making the final reading of 5.84 per cent for March as the latest comparable figure.
March is the sixth consecutive month in which retail inflation came in above the RBI’s medium-term goal of 4 per cent.
The Reserve Bank of India (RBI) tracks data on consumer inflation – or the rate of increase in retail prices determined by the Consumer Price Index (CPI) – primarily for formulating monetary policy.
However, some say consumer inflation might not remain the driver of policy due to the rapidly-spreading COVID-19 outbreak.
Last month, the central bank lowered the repo rate – the key interest rate at which it lends short-term funds to commercial banks – to 4 per cent, the lowest on record, to prop up the economy following an emergency meeting of its Monetary Policy Committee. RBI Governor Shaktikanta Das said the economy was expected to contract in the current financial year.
Some economists expected price pressures for food to be moderate over the coming months based on expectations of a normal monsoon.
Many groups of economists have anticipated a further blow to the economy, which was already staring at the worst pace of annual expansion in more than 11 years, thanks to the COVID-19 outbreak.