Urban poor bearing the brunt of high inflation: Crisil

Rising fuel prices remain a festering pressure point for households

The urban poor have been the worst-hit by the high inflation that has prevailed over the past one-and-a-half years, and the persistent uptick in fuel prices continues to pose a major threat for them, rating agency Crisil said in a note on Friday.

While inflation shrinks purchasing power across the board, the impact on different income classes varies with their share of spending on different commodity groups, Crisil economists D.K. Joshi and Pankhuri Tandon pointed out. They segregated the population into three groups by spending, and mapped inflation in commodities they consume.

They found that the experience of inflation was similar across income groups in rural India, but the urban poor faced a double whammy last year as well as in the first half of this year.