According to data released by the Indian government on July 12, the country’s retail inflation rate increased to 4.81% in June from 4.31% in May. This increase was driven by a rise in food price inflation suffered by consumers, which rose to 4.5% from less than 3% in the previous month.
According to figures released by the government on Wednesday, India’s retail inflation increased by 4.81% in June, breaking a four-month downward trend as a result of rising food costs. This means that there will not likely be a reduction in interest rates any time in the near future. The Consumer Price Index in India rose by 4.31 percent in the month of May.
Because of the erratic nature of the monsoon rains, which have caused damage to the crops of certain perishable goods and slowed down the flow of goods, there are currently shortages of essential ingredients for cooking, such as tomatoes, chilli peppers, and onions.
The food price index rose to 4.49% in June from a revised figure of 2.96% in May. Food prices account for more than half of the total consumer price basket. The monthly rises in the prices of vegetables were 12% higher in June than they were in May.
Because the upward pressure on food prices is anticipated to continue over the next few months, it is less probable that inflation will revert to the 4% objective set by the Reserve Bank of India in the short term. The index of India’s industrial production increased by 5.2% in the month of May, following a 4.2% increase in April and a 19.7% increase from the previous year.
When making its decision about the direction of monetary policy every two months, the central bank focuses primarily on the CPI. The next examination of the policy is planned for the beginning of the following month. A month ago, the Reserve Bank of Australia (RBA) decided not to alter the current policy rate of 6.5 percent and instead estimated that retail inflation for the current fiscal year would average 5.1 percent, with inflation for the June quarter being pegged at 4.6 percent.