Retail inflation rises for sixth straight month, up 3.18% in June

Rising for sixth month in a row, retail inflation rose to 3.18 per cent in June due to costlier food products such as grains, pulses and protein-rich items meat and fish, government data showed on Friday (July 12).

The Consumer Price Index (CPI)-based retail inflation was at 3.05 per cent in the preceding month of May 2019. In the year-ago period, the retail inflation was at 4.92 per cent in June 2018. Retail inflation has been showing a rising trend since January this year when it stood at 1.97 per cent. The overall food inflation based on consumer food price index rose to 2.17 per cent in June as against 1.83 per cent in the previous month, the Central Statistics Office (CSO) data released by the Ministry of Statistics and Programme Implementation showed.

The inflation for protein-rich meat and fish category quickened to 9.01 per cent during the month (against 8.12 per cent month earlier). For the pulses and products category, the rate of price rise was sharply higher at 5.68 per cent against 2.13 per cent, while the inflation in the cereals and products basket rose to 1.31 per cent from 1.21 per cent in May this year.

However, prices of fruits continued to show deflationary trend with inflation standing at (-)4.18 per cent, while inflation in vegetables eased to 4.66 per cent. For the fuel and light category, retail inflation in June slowed a tad at 2.32 per cent. “In line with our expectation, CPI inflation remained largely benign… despite the delay in the monsoon and kharif sowing.

“While vegetable prices are likely to firm up in the ongoing month on the basis of seasonal factors as well as higher transport costs, the pick-up in the monsoon rainfall in the last week is likely to boost sowing in the near term, which would help keep food inflation in check,” said Aditi Nayar, principal economist, ICRA.