Ghar Kharcha: Will It Be A Happy Diwali After All?
The much-feared third wave has not yet hit, the economy is picking up and, now, even prices are showing some signs of easing, albeit temporarily.
Retail inflation fell to a five-month low of 4.35% in September, according to data from the government. Food and beverage inflation at 1.61% is at a 29-month low.
But what does this mean for the household budget, particularly as the festive season approaches? There's good news, peppered with some cause for worry.
Food Inflation: A Dietician's Delight?
First, your daily vegetarian meal is getting cheaper. Prices of rice, wheat, and all three key vegetables—potatoes, onions and tomatoes—continue to fall.
Potato prices have dropped 48.47% compared with a year earlier, after falling 39.6% in August. Onion prices showed a sharp reversal in trend, cooling 9.6% after a rise of 24% over a year earlier in August. Even tomatoes saw a sharp decline of 45.7% in September, following a 34.5% drop in the previous month.
Since the start of the year, potatoes and onions have turned cheaper, along with a decline in the prices of eggs and atta.
But if you love your butter chicken, then the key ingredient is still 14% costlier than a year earlier.
Unless you are a health freak and eating raw and boiled food, your cooking oil is another strain on the budget.
Inflation in oils and fats, especially in refined oil and vanaspati, is still very high and sticky. Refined oil is costing you 43.6% more annually, compared with 43.9% in August. Vanaspati, too, costs 41.89% more, compared with 39.64% a month prior. Since the year's start, refined oils are up 23.9%.
As your dietician may say—go easy on the oil.
You may have little option to reduce cooking costs, though. LPG prices continued to increase, jumping 41.4% in September, after a rise of 35.3% last month, according to government data.
The dietician also tells you to cut back on refined sugar and the price tags agree.
Sugar prices made a U-turn in September, rising 3.6% after having declined 0.9% in August. Inflation in sweets, cakes and pastries rose to 8.1% in September, up from 7.8% a month prior.
The message—cut your sugar intake this Diwali.
The health conscious are luckier. Jaggery prices rose just 0.5%, while honey is 8.68% cheaper.
Planning to host a cards party? Need to stock up on beer? Prices of beer rose 1.5% in September after a steady decline through the course of the year.
Shopping List: Old Clothes; New Jewelry?
Investing in gold this Dhanteras? Gold prices this September were 7.7% lower than a year earlier. Since the start of 2021, gold has declined 5.5%, while silver is down 2.4%.
You may want to find ways to style your old party-wear in new ways with clothes and footwear costing more. Clothing and footwear inflation was at 7.2% in September. That's the highest it has been at since 2014.
If your Diwali wish list includes a new car as you resume travel to the office, or maybe just an upgrade to a new phone, inflation has remained range-bound. The new iPhone 13 Pro not included.
Utilities: Travel Less? Celebrate At Home?
What continues to pinch is fuel costs.
The rise in prices of petrol and diesel continues to burn a hole in household budgets and that's only likely to sting more amid the festive season holidays.
In September, petrol prices for vehicles rose 22.3%, while diesel prices for vehicles rose 22.4%. This was nearly the same as in the previous month.
That only adds to your already soaring cost of cooking gas.
Air fare is also now costlier so your holiday travel budget will need to factor that in.