"Sticky" inflation is still a global worry!

While major world economies have successfully tackled inflation over the last six months by bringing retail inflation (the monthly consumer price index-based inflation) close to the central bank target rates of 2% with and emerging economies including India’s Reserve Bank of India have achieved some measure of success, all is not well yet.

- Dr.T. K. Jayaraman

Table 1 presents data on world inflation ever since the Covid-19 pandemic receded and recovery looked promising, but cut by Russia-Ukraine conflict in March 2022, which is still ongoing. The Table reports the success of anti-inflationary measures. The United States (the US) economy brought down the inflation from a high level of 8.30% in April 2022 to 3.20% in February 2024, which however rose though slightly, to 3.50% in the following month, March. Inflation in United Kingdom (UK) decreased from the highest 11.10% in October 2022 to 3.20% in March 2024, yet above the target of 2%. Only the European Central Bank, the common central bank for the Eurozone, was able to come much closer to its target rate of 2%. It brought down the inflation from highest in October 2022 to 2.40% in March 2024.

India’s inflation: above the target

In the case of India, inflation was brought down from 7.70% in April 2022 to 4.85% in March 2024. However, it continues to be above the target rate of 4%.