Retail inflation increases to 5.08% in June on a four-month high
Retail inflation increased to 5.08% in June, a four-month high on an annual basis, up from 4.80% in May last month, according to official data issued on Friday, July 12, 2024.
“The year-on-year inflation rate based on the All India Consumer Price Index (CPI) number is 5.08% (Provisional) in June 2024. The corresponding inflation rates for rural and urban areas are 5.66% and 4.39%, respectively, according to a Ministry of Statistics & Programme Implementation announcement.
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The inflation rate has remained within the Reserve Bank of India (RBI) tolerance range of 2-6%.
Food inflation rose to 9.55% from 8.69% in May
Food inflation was 9.55% in June, up from 8.69% in May and 4.55% in June 2023. Rural inflation increased to 5.67% in June, from 5.34% in May and 4.78% in June 2023.
In contrast, urban inflation fell marginally to 4.39% in June, from 4.21% in May and 4.96% in June 2023.
India’s Index of Industrial Production (IIP) climbed by 5.9% in May, up from 5% in April, according to data provided by the Ministry of Statistics and Programme Implementation (MoSPI) on Friday.
“The CPI inflation came marginally higher than our expectations. While the food inflation risks will continue to dominate in near term, we expect the better sowing patterns and spatial distribution of rains to eventually ease the price pressures beyond these volatile months. Having said that, the Central Bank will be in no hurry to ease monetary policy given the headroom from robust growth in the backdrop of near term inflation risks,” said Upasna Bhardwaj, Chief Economist, Kotak Mahindra Bank.
