Retail Inflation Surges to 5.08% in June Due to Rising Food Prices

Retail inflation increased to 5.08% in June driven by higher kitchen item costs, as per government data. The inflation in the food basket rose to 9.36% from 8.69% in May. The Reserve Bank of India has been tasked to maintain CPI inflation around 4%, with a margin of 2% either way.

Retail inflation soared to 5.08 percent in June, propelled by escalating prices of kitchen items, according to data released by the government on Friday.

The Consumer Price Index (CPI) based retail inflation stood at 4.8 percent in May 2024 and 4.87 percent in June 2023, marking a notable increase.

According to the National Statistical Office (NSO), inflation within the food basket jumped to 9.36 percent in June from 8.69 percent in May.

The government has directed the Reserve Bank of India (RBI) to ensure CPI inflation remains around 4 percent with a 2 percent margin on either side.

The RBI forecasts CPI inflation for 2024-25 at 4.5 percent, with Q1 at 4.9 percent, Q2 at 3.8 percent, Q3 at 4.6 percent, and Q4 at 4.5 percent.

The central bank primarily considers retail inflation while deciding its bi-monthly monetary policy.

(With inputs from agencies.)