According to reports, retail inflation in India may go beyond the RBI's 6 per cent limit in the near future. This comes at a time when onion prices are increasing across the country.
Onion is considered as a staple and essential component of the Indian household. As per reports, the price of 1 kg onion is inching closer to INR 100 in major metro cities like Mumbai and Delhi.
Onion prices have risen to INR 60-70 per kg from INR 40-60 per kg in all major wholesale markets. Looking at the current situation, the possibility of onion price going up to INR 100 per kg in the next few days cannot be ruled out.
According to an ANI report, onions are being sold at the rate of INR 80 per kg in the financial capital Mumbai. Meanwhile, there has been an increase in wholesale rates in the national capital Delhi as well.
The recent hike in onion prices is contributing to the poor quality of the produce. The lower quality of the kharif crop in the major states of Maharashtra, Rajasthan and Karnataka has led to increased demand for the older and more expensive crop. Another reason contributing to this phenomenon is the increase in export demand.
The value of the Indian Rupee has further depreciated. The Indian rupee has risen to 84.39 against the US dollar. The Indian rupee has hit an all-time low. This is affecting regular Indian consumers. This has led to fears of an increase in inflation in the coming weeks and months.
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