India CPI Inflation Rate 2020: Retail inflation growth across the country eased to 6.69 per cent in the month of August, the data released by the Ministry of Statistics & Programme Implementation (MoSPI) showed.
The retail inflation which is measured by the Consumer Price Index (CPI) for the month of July was also revised to 6.73 per cent from 6.93 per cent. Last month too, the government had revised the CPI data for June to 6.23 per cent from 6.09 per cent.
Prior to June’s data, the government had not released the headline retail inflation data in April and May. However, in April, it had revised the CPI data for the month of March to 5.84 per cent from 5.91 per cent.
The retail inflation has grown beyond the Reserve Bank of India’s (RBI) upper margin of 6 per cent. The government has mandated the Indian central bank to keep inflation within the range of 4 per cent with a margin of 2 per cent on either side.
The central bank in its bi-monthly monetary policy meeting last month had kept its key interest rates on hold even as it vowed to keep policy sufficiently loose to help revive the coronavirus-battered economy.
The Consumer Food Price Index (CFPI) or the inflation in the food basket eased to 9.05 per cent in the month of August. Also, the CFPI for July was revised to 9.27 per cent from 9.62 per cent, the data revealed.
The growth in retail inflation was primarily due to a rise in meat and fish prices that saw a 16.50 per cent on-year rise in August. Apart from meat and fish segment, the pulses and products segment saw a rise of 14.44 per cent, while that of oils and fats rose 12.45 per cent and spices prices gained 12.34 per cent. The vegetables segment also witnessed a rise of 11.41 per cent.
Reflecting on the development, Rahul Gupta, Head of Research- Currency at Emkay Global Financial Services said, “Despite unlocking phases, the supply-side disruption is surging the food and fuel prices. The inflation figure for the fifth month in a row remains above RBI’s medium-term target of 6 per cent, so RBI rate cut hopes still remains low at least at the October policy.”