Retail inflation eases slightly to 6.26% in June

India’s retail inflation, measured by the Consumer Price Index (CPI), eased marginally to 6.26 per cent in the month of June 2021 over 6.30 per cent in May 2021. Though, this is the second successive time that the CPI data has come over the Reserve Bank of India’s (RBI) upper margin of 6 per cent. Prior to this, the CPI came below the 6 per cent mark for five consecutive months. The government has asked the central bank to maintain retail inflation at 4 per cent with a margin of 2 per cent on either side for a five-year period ending March 2026.

The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that the Rural CPI (General) in June stood at 6.16 per cent as against 6.55 per cent in May. The Urban CPI (General) stood at 6.37 per cent in June as against 5.9 per cent in May. The index value for Rural, Urban and Combined CPI (General) stood at 162.1, 160.4 and 161.3, respectively, in June 2021. The marginal slippage in the CPI-based inflation was noticed despite little firmness witnessed in the food inflation. The Consumer Food Price Index (CFPI) or the inflation in the food basket, inched slightly higher on-month during June to 5.15 per cent, from 5.01 per cent in May.

The hike in the food basket was mainly due to a sharp rise in prices of oils and fats which surged 34.78 per cent on year in June. Apart from this, the egg prices segment saw a rise of 19.35 per cent while that of fruits gained 11.82 per cent and pulses and products rose 10.01 per cent. Non-alcoholic beverages climbed 14.71 per cent. On the other hand, the vegetables segment slipped (-) 0.70 per cent and cereals and products declined (-) 1.94 per cent. Apart from food and beverages, the fuel and light segment rose 12.68 per cent in June, while clothing and footwear gained 6.21 per cent and the housing segment inched up 3.75 per cent.

The Price data are collected from representative and selected 1114 urban Markets and 1181 villages covering all States/UTs through personal visits by field staff of Field Operations Division of NSO, MoSPI on a weekly roster. During the month of June 2021, NSO collected prices from 99.6% villages and 98.6% urban Markets while the Market-wise prices reported therein were 78.7% for rural and 82.0% for urban.