The last time the WPI was in single digit was in the month of March in 2021, when it was at 7.89 per cent. Since April 2021, WPI inflation remained in double digits for 18 months, with the September print at 10.79 per cent.. Pic: iStock

Retail inflation eases to five-month low of 6.71 per cent in July

The Federal
12 Aug 2022 7:48 PM IST

India’s Consumer Price Index-based retail inflation eased to a 5-month low of 6.71 per cent in the month of July, down from 7.01 per cent in June. But, despite declining to its lowest level since February 2022, the CPI continues to remain above the Reserve Bank of India’s (RBI) upper margin of 6 per cent for the seventh consecutive month.

The government has mandated the central bank to maintain retail inflation at 4 per cent with a margin of 2 per cent on either side for a five-year period ending March 2026.

Also read: Unacceptably high inflation behind 50 bps rate hike: RBI Governor Das

Food inflation falls

The inflation in the food basket too showed a month-on-month fall during July to 6.75 per cent, from 7.75 per cent in June, the data revealed. Prices of vegetables rose 10.90 per cent on year in July. Apart from this, the spices saw a rise of 12.89 per cent while that cereals and products gained 6.90 per cent and oils and fats rose 7.52 per cent. Egg prices slipped (-)3.84 per cent, but fruits grew 6.41 per cent.

Apart from food and beverages, the fuel and light segment rose 11.76 per cent, clothing and footwear gained 9.91 per cent and the housing segment inched up 3.90 per cent.

The CPI data is mainly factored in by the RBI while making its bi-monthly monetary policy. In a bid to check the raging inflation, the Monetary Policy Committee (MPC) of the central bank last week hiked the repo rate by 50 basis points (bps) to 5.40 per cent.

IIP shows growth

India’s factory output, measured in terms of Index of Industrial Production (IIP), witnessed a growth of 12.3 per cent on-year to 137.9 during the month of June, a separate data released by the Ministry of Statistics & Programme Implementation (MoSPI) showed. The IIP had risen 13.8 per cent in June 2021, the data showed.

The industrial growth so far in the fiscal year 2022-23 (April-June) has surged 12.7 per cent, compared to a contraction of spike of 44.4 per cent in the corresponding period a year ago, the data showed.

The growth in IIP data during June was led by manufacturing and electricity sectors. The electricity sector rose 16.4 per cent on-year to 196.9 in June. It was followed by the manufacturing sector that witnessed a growth of 12.5 per cent to 136.3. The mining sector saw a 7.5 per cent growth to 113.4, the MoSPI data showed.

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