Ghar Kharcha: Festive Season Spending – Will ‘Inflation-Āstra’ Play A Downer?
Ghar Kharcha: Time for fewer cereals, more rice and dal?
This festive season brings hope after the pandemic dimmed celebrations in the last couple of years. It’s that time of the year when Indians start to load up on clothes, household appliances, gold and jewellery, and of course sweets. But as prices soar, how far can they stretch their purse strings?
Retail inflation rose to 7% in August after falling for three months. While inflation in rural areas rose to 7.15%, it fell to 6.7% in urban areas—though the lowest in five months in both cases.
Food: Cereals Rise To Eight-Year High
Cereals inflation spiked to 9.57% in August—the highest since January 2014. Cereals and by-products make up the largest component of the Indian consumer’s food basket with 12.35% weight.
Within the cereals basket:
Inflation in rice rose to 6.9%—the highest since June 2020
Inflation in atta rose to 15.7%- the highest since at least 2015.
Inflation in by-products such as maida rose to 13.3% from 8.7%.
Suji, sewai, breads and bakery, biscuits and chocolates all got expensive.
Spices inflation rose to 14.9% in August—the highest since at least 2014.
Oils and fat inflation continued to provide some relief at 4.6%—the lowest since December 2019.
Clothing And Footwear: A Relentless Rise
Waiting for the big billion day sale? So are we.
Inflation in clothing and footwear was at 9.91%—the highest since at least 2014. Clothing inflation rose to a record high of 9.6%, while footwear inflation was at 11.9%.
Housing inflation rose to 4.06%—the highest since 2020.
Education inflation rose to 5.51%—the highest since October 2019.
Utility Bills: LPG Stings
Transport and communication inflation eased to 5.2% in August—the lowest since March 2020. Prices of diesel and petrol for vehicles provided some relief, declining from a year ago. But prices of LPG and kerosene rose faster.