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HYDERABAD:Telangana’s inflation rates have been the most volatile in the country, ranging from 10% in June 2022 to 8.5% in August 2023.

Despite stabilising from a peak of 10% and a sharp drop to nearly 6% in July, rural inflation continues to remains high in the state. Compared to states like Andhra Pradesh, Maharashtra and Madhya Pradesh which saw inflation rates fluctuating between 7% and 8%, Telangana’s inflation kept swinging big time in a span of one year.

According to the most recent CPI inflation rates released by the ministry of statis tics and programme implementation, Telangana’s inflation stood at 8.5% last month.

Because of the high cost of fuel, vegetable and other commodities’ prices have also surged which led to high inflation, experts said.

“Telangana’s inflation rate was like a seesaw, constantly shifting between very high and low. No other state has se en inflation fluctuating so much in just one year,” an expert said.

Experts said fluctuations indicate price increase for certain food items that are given more weightage than others while calculating inflation.

“CPI inflation is calculation of a range of prices of many food commodities and each commodity is assigned a specific weightage based on its price and consumption. For example, rice is the most commonly consumed food in our region and recent price increase in rice may have contributed to an increase in inflation,” said A Nakula Reddy, former professor of economics, Osmania University.

Between 1969 and 2023, In dia’s inflation rate averaged 7.7%, with an all-time high of 34.7% in October 1974 and a record low of -11.3% in May 1976.

“The situation in Telangana would have been more or less similar. Understanding inflation needs deeper details but high fuel and oil prices certainly increase the prices of other commodities” Nakula Reddy said.
According to financial and banking expert K Narasimha Murthy, “It is a good sign that the inflation is on the downside. Despite fluctuations, there is a need to bring down prices of fuel by both state and central governments as it will improve buying capacity of consumers and create more jobs and thereby reduce the inflation within an acceptable range.”

The Reserve Bank of India has set a 4% inflation target with a 2% margin of error. As aresult, the acceptable range is between 2% and 5%.

  • Published On Sep 26, 2023 at 02:14 PM IST

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