Prices are again on the upward spiral, going by the latest consumer price index (CPI) numbers released by the Central Government today.
The CPI is calculated on the basis of country-wide surveys by the National Sample Survey, the government survey agency, and is now being released on a per-state basis as well.
Consumer prices rose 8.83% in February compared with exactly a year ago. January prices were up only 7.65% compared with a year ago, indicating an acceleration in prices in February. The price increases were felt primarily in urban areas.
However, some of the effect was due to the dip in prices in February 2011 — which was not there in 2012.
Price levels in urban areas in February were at 102.6 (or 2.6% higher than the base year of 2010), compared with 102.3 in January 2012. In rural areas, they remained stable at 108.3 in February, compared with January.
However, even stable prices from January would indicate high rates of inflation for the government as prices have typically been higher in the first two months of the year for the last several years.
If they fail to decline as they have been in the last few years, inflation rates could shoot up further.
Milk, fuel and ‘clothing, bedding and footwear’ were the items which saw the highest price rise.
Fuel prices, which reflect the raises in petrol prices by government companies, were higher by 12.78% in February. The only other item which had a higher price inflation was ‘milk and products’, which saw a price increase in the CPI of 15.76% (see chart.)
North Eastern states turned out to be the ones with the fastest rise in prices, according to the CPI.
Meghalaya prices were up 27.9% in two years, compared with the national average of 14.6% (see chart.)
On an all India level, rural prices are rising faster than prices in urban areas.