Retail Inflation in June quickens to 5.08%

Retail inflation June: India's headline retail inflation inched up to 5.08 per cent in June 2024, according to data released by the Ministry of Statistics and Programme Implementation on July 12. In the month of May, the retail inflation stood at 4.75 per cent, which was lower than April’s 4.83 per cent.  

Staples like tomatoes, onions, and potatoes saw double-digit price hikes last month as severe heat and floods disrupted agricultural production in northern states. A Reuters poll conducted from July 5-9 among 54 economists projected consumer price inflation to have increased to 4.80 per cent in June, slightly up from 4.75 per cent in May. Among food items, vegetable prices rose from 27.33 per cent in May to 29.32 per cent in June. 

Core Inflation and Food Prices

Core inflation, which excludes volatile components like food and fuel rose from 2.97 per cent in May to 3.1 in June 2024, in accordance with analysts and polls estimates. 

On the food inflation side, the Consumer Price Food Index (CPFI) stood at 9.36 per cent in June, higher in comparison to 8.69 per cent in May, and 8.7 per cent in the month of April. 

In its latest policy review, the Reserve Bank of India (RBI) maintained its FY25 inflation projection at 4.5 per cent but cautioned that food prices could remain sticky.

The upward trend in headline inflation was partly due to a rise in the prices of vegetables, pulses and cereals because of the heatwave and monsoon. 

Industrial Production Slows

On the same day, data showed that growth in the Index of Industrial Production (IIP) slowed to 5.9 per cent in May from 5 per cent in April. The index of industrial production stood at 5.4 per cent in March.

Detailed CPI Internals from 27.80 per cent in April. 

Pulses inflation moderated to 16.07 per cent in June from 17.14 per cent recorded in May.