The government gave this great news regarding tomatoes and pulses, know how long the fire of inflation will scorch the common people?

Photo: PTI tomato

Disturbing news is coming in the country regarding the price of vegetables to pulses. For the last two months, the prices of tomatoes have crossed Rs 100, while pulses are also moving towards double century. Common people are worried about the prices. Meanwhile, the government has given relief news. The Finance Ministry said on Tuesday that the pressure on food prices is likely to be short-lived only, with prices of tomatoes and pulses softening. However, the government and the Reserve Bank need to be more vigilant in dealing with rising inflationary pressures.

Monthly report released by the government

In its monthly economic review for July, the ministry said that going forward, domestic consumption and investment demand is expected to sustain growth. Private investment is now on the rise as the government has increased provision for capital expenditure in the current financial year. Retail inflation based on the Consumer Price Index reached a 15-month high of 7.44 per cent in July 2023. However, core inflation remained at a 39-month low of 4.9 per cent.

Inflation of grains and vegetables is troubling

The ministry said that the price of cereals, pulses and vegetables saw a double-digit increase in July compared to the same period last year. Disruption to domestic production also exerted pressure on inflation. According to the Monthly Economic Review, “With the government already taking precautionary measures to control food inflation, the price pressure in the market is likely to ease soon with the arrival of fresh stocks. The rise in food prices is expected to be temporary.

Foreign impact on inflation

Global uncertainty and domestic disruptions may add to inflationary pressures in the coming months, requiring greater vigilance by the government and the Reserve Bank of India (RBI). The ministry said the prices of commodities like tomato, green chillies, ginger and garlic increased by more than 50 per cent. Therefore, food inflation remained high in July 2023 due to abnormal increase in prices of certain items.

New tomato crop will come by the end of August

The Finance Ministry said, “With the arrival of new tomato consignments in the market by the end of August or the beginning of September, its prices are expected to come down. Apart from this, the prices of pulses are also likely to soften due to increase in the import of tur dal. With this, food inflation may soon come down in the coming months due to recent government efforts. According to the ministry, domestic consumption and investment demand is expected to maintain the pace of growth. However, inflationary pressures may increase in the coming months due to global and regional uncertainties and domestic tensions. In such a situation, both the government and the central bank will need to be more vigilant.

Reserve Bank has also expressed apprehension

The Monetary Policy Committee of the RBI, in its meeting held in early August, decided to keep the policy repo rate unchanged at 6.5 per cent. This was done as inflation was kept under control to some extent. However, the RBI also expressed apprehensions of pressure on food prices due to adverse weather events due to El Nino in August and beyond.

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