Data | Which items drove up inflation in February 2022?

Retail inflation crossed the RBI’s comfort level (6%) for the second consecutive month while wholesale inflation remained in double digits for the eleventh consecutive month

Retail inflation has accelerated to 6.07% in February 2022, crossing the RBI’s comfort level (6%) for the second consecutive month. Wholesale inflation remained in double digits for the eleventh consecutive month. Data show that wholesale inflation increased in February due to the high prices of certain vegetables, diesel, petrol, crude oil, air turbine fuel, chemicals (caustic soda, ammonia), raw silk, raw cotton, and rose (flower). The surge in retail inflation is primarily attributed to the increased costs of certain vegetables, mustard oil, vanaspati, airfare, chicken, telephone charges, petrol, kerosene, and LPG.

The chart shows wholesale and retail inflation between January 2019 and February 2022. In February 2022, retail inflation accelerated to an eight-month high of 6.07% on the back of high food and fuel inflation. Wholesale inflation increased slightly to 13.11%, and it remained in double digits for the eleventh consecutive month. Wholesale inflation has remained high primarily due to imported commodities such as crude oil.

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The wholesale price inflation (WPI) of all items in February 2022 is depicted on the vertical axis. The weight of those items in the inflation calculation is depicted on the horizontal axis. For instance, wholesale inflation of cabbage accelerated by 199.5% and carries a weight of 0.12% in the final inflation calculation.

In February, the WPI of onion decelerated by 26.4%. However, unlike in January, the WPI of potatoes accelerated (14.8%) in February. The WPI of brinjal, cauliflower, and tomato accelerated by over 75%, 50%, and 15%, respectively. These five vegetables carry the most weight in the wholesale calculation. The WPI of bitter gourd and radish accelerated by over 95% but carry less weight in the calculation.

The WPI of crude, diesel, and petrol accelerated by at least 50%. All of them carry significantly more weight in the calculation. The WPI of chemicals like ammonia liquid and caustic soda have also accelerated by over 80%. The WPI of raw cotton, raw silk, and rose flower accelerated by over 50%, 75%, and 80% respectively.

The retail inflation (CPI) of all items in Feb. 2022 is depicted on the vertical axis. The weight of those items in the inflation calculation is depicted on the horizontal axis. For instance, the retail inflation of cauliflower accelerated by 60% and carries a weight of 0.24% in the final inflation calculation.