Ukraine war led to inflation in FY23: RBI
Common shocks emanating from the ongoing war in Ukraine - high food, energy and other commodity prices - as well as globalisation of inflation to multi-decadal high levels
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New Delhi: Common shocks emanating from the ongoing war in Ukraine - high food, energy and other commodity prices - as well as globalisation of inflation to multi-decadal high levels, exerted sustained upside price pressures in India, leading to inflation remaining above the upper tolerance level of 6 per cent over 10 consecutlive months in 2022-23, according to the Reserve Bank of India's (RBI) annual report.
The RBI in its annual report for 2022-23 added that inflation eased somewhat during November-December 2022 on seasonal easing in food prices, before rising again during January-February 2023 and moderating to 5.7 per cent in March 2023.
"Monetary tightening by major economies and associated volatility in financial markets led to imported inflation pressures," it added. Input cost pressures from high industrial raw materials prices, transportation costs, and global logistics and supply chain bottlenecks impinged on core inflation. "The upward pressures from an early onset of summer, heat waves and unseasonal rains on food prices in the first half receded in the second half of the year, with the robust kharif harvest and seasonal fresh crop arrivals as well as some easing in global food prices," the report noted.
