The BoB Essential Commodity Index (BoB ECI) witnessed a notable acceleration in March 2024, marking a year-on-year increase of 5.9% and a sequential rise of 0.4%, as per Dipanwita Mazumdar, Economist at Bank of Baroda. Adjusted for seasonal variations, the growth rate stood at 0.8%. This surge is largely driven by the heightened prices of vegetables, notably potatoes and onions, alongside other commodities like edible oils and pulses, contributing to food inflation concerns. High-frequency price data underscores the persistent risk vegetables, especially potatoes and onions, pose to food inflation, exacerbated by unseasonal rains affecting potato production in December.
Comparatively, the BoB ECI's year-on-year increment reached its peak since August 2023, with a 5.9% upsurge in March 2024, outpacing the 4.2% rise noted in the preceding month. Noteworthy is the price momentum in nine out of twenty surveyed commodities, with potatoes and onions experiencing significant hikes of 22% and 40.1% respectively in March 2024, from February's 5.3% and 28.9%. In the initial days of April 2024, vegetable prices saw mixed trends; tomato prices saw an upward adjustment, whereas potato prices saw a moderate rise and onion prices showed a decline, according to Bank of Baroda's analysis.
Source: thestatesman.com