India's retail inflation dips marginally to 6.69% in August
What's the story
India's retail inflation stood at 6.69% in August, according to data released by the Ministry of Statistics & Programme Implementation (MoSPI) on Monday. Retail inflation, or the rate of increase in consumer prices, is determined by the Consumer Price Index (CPI). While retail inflation was lower than economists' estimates, it remained above the Reserve Bank of India (RBI)'s upper limit of 6%.
Details
August retail inflation at 6.69% against 6.73% in July
Government data showed that retail inflation stood at 6.69% in August (rural: 6.66%; urban: 6.80%). The retail inflation for July has been revised from 6.93% to 6.73%. The marginal dip goes against estimates by nearly 50 economists, who had expected consumer prices to rise by 6.85% in August, according to a Reuters poll. However, retail inflation remained above the RBI's medium-term range of 4-6%.
Food
Food inflation softened to 9.05%
Meanwhile, food inflation based on the Consumer Food Price Index (CFPI) dipped to 9.05% in August against 9.27% the previous month. Notably, the rate of price rise in the 'meat and fish' segment stood at 16.50%. Inflation for eggs, vegetables, pulses and products, and spices remained in double digits at 10.11%, 11.41%, 14.44%, and 12.34% respectively. Inflation for fruits stood at 1%.
RBI
Last month, RBI left key interest rate unchanged citing inflation
Last month, the RBI—which tracks retail inflation while revising its monetary policy—had left the repo rate unchanged citing inflationary pressures. The repo rate is the rate at which it lends funds to commercial banks. The RBI had said it would ensure retail prices are contained within its medium-term target. RBI Governor Shaktikanta Das has warned that consumer inflation will remain high through September.