Retail inflation edges up to 2.86 per cent in March on costlier food articles.

The consumer price index (CPI)-based retail inflation was at 2.57 percent in February this year. On a yearly basis, it was 4.28 percent in March 2018.

India's retail inflation ticked up to 2.86 percent in March as consumers spent more to buy food items and fuel, government data showed Friday.

The consumer price index (CPI)-based retail inflation was at 2.57 percent in February this year. On a yearly basis, it was 4.28 percent in March 2018.

Retail inflation remains well within the RBI's comfort level of 4 percent for about eight months now, coming down from 4.17 percent in July 2018.

The overall food inflation, measured as change in prices of articles in food basket, rose to 0.3 percent in March, against (-) 0.66 percent in February, data from the Central Statistics Office (CSO) of the Ministry of Statistics and Programme Implementation showed.

In 'fuel and light' category, the rate of price rise in March climbed to 2.42 percent from 1.24 percent in February.

Fruits and vegetables continued to register deflation at (-)5.88 percent and (-)4.90 percent, respectively. 

For cereal and products, the rate of price rise slowed to 1.25 percent from 1.32 percent, as per the data.

The Reserve Bank has cut the retail inflation forecast to 2.9-3 percent for the first half of the current fiscal, mainly due to lower food and fuel prices as well as the expectation of a normal rainy season.

For the rest half of 2019-20, it has forecast the retail inflation in the range of 3.5-3.8 percent. 

Retail inflation is the key input for the RBI to decide on its key bi-monthly policy decision. 

The RBI reduced the key policy rate by 25 basis points to 6 per cent in its first monetary policy outcome earlier this month.