CPI Inflation for the month of Jan-20 came in at a 68-month high of 7.59%. This was largely driven by food inflation but core inflation has also chipped in with its own contribution. That could be something for the RBI to be cautious.
Double whammy on inflation
If you look at the inflation number for Jan-20, then it is up to the highest level in nearly 6 years. This is despite the fact that food inflation has come down marginally compared to December. Then why is CPI inflation higher? Firstly, fuel inflation has inched up during the month of January. Secondly, the core inflation (non-oil and non-food) has also inched up during the month of Jan-20. In the last few months, it was only food inflation but now core inflation is also proving to be a worry for the RBI. That could be the double whammy!