India Business Journal - CPI-based retail inflation for August rises marginally to 3.65% below RBI’s target

ECONOMY

CPI-based retail inflation for August rises marginally to 3.65% below RBI’s target

IBJ Bureau
Sep 13, 2024

Retail inflation marginally increased to 3.65 per cent in August and remained within the Reserve Bank of India’s target of 4 per cent, the government data showed on Thursday. The inflation also was below 4 per cent in July.

“Year-on-year inflation rate (3.65 per cent) based on All India Consumer Price Index (CPI) for the month of August 2024, is second lowest in the last five years,” National Statistical Office (NSO) said.

The Consumer Price Index (CPI)-based retail inflation was 3.60 per cent in July 2024 and 6.83 per cent in August 2023.

Inflation in the food basket was 5.66 per cent in August, marginally up from 5.42 per cent in July, according to the data released by the NSO.

Vegetables and pulses witnessed price rise in double digits, according to official data released on Thursday. Inflation in vegetables was 10.71 per cent and in pulses and products at 13.6 per cent.

The CPI was in negative in case of spices (-4.4 per cent) and oils and fats (-0.86 per cent).

Food inflation for August 2024 is the second lowest since June 2023.

Inflation in case of fuel and light segment too was in negative at (-) 5.31 per cent.

The data showed that retail inflation was at 3.14 per cent at urban centres and 4.16 per cent in rural areas.

Commenting on the data, ICRA Chief Economist Aditi Nayar said that with the base effect normalising, “we anticipate a sharp pickup in the CPI inflation to about 4.8 per cent in September 2024 and range between 4.4 and 4.7 per cent in H2 FY2025”.