New Delhi: Of India retail inflation The Consumer Price Index-based (CPI) stood at 7.01% in June, showed data released by the government on Tuesday.
This is the third consecutive month that the inflation numbers have remained above 7 per cent and the sixth consecutive month that the figures have remained above the Reserve Bank of India’s (RBI) tolerance band of 2-6%.
The RBI primarily factors in retail inflation while arriving at its bi-monthly policy.
The Monetary Policy Committee (MPC) of the Reserve Bank has been tasked by the government to control retail inflation at 4% (+, -2%) based on the Consumer Price Index (CPI).
A sharp rise in food and fuel prices – due to Russia’s invasion of Ukraine – pushed India’s overall inflation to an 8-year high of 7.79%. This was partially controlled in May after the government cut taxes on petrol, diesel and banned food exports.
However, food inflation, which accounts for almost half of the CPI basket, is growing at the fastest pace in 2 years.
The RBI has hiked interest rates by 90 basis points to 4.9% so far this year and is set to add more in the coming months.
Recently, RBI Governor Shaktikanta Das said that inflation is unlikely to fall within the top end of its mandated target band till December.
Even though the CPI numbers have eased since April, rising trade and current account deficit on account of global crude oil prices pushed the rupee to record levels against the US dollar. Thus, expressing concern over high imported inflation.
This is the third consecutive month that the inflation numbers have remained above 7 per cent and the sixth consecutive month that the figures have remained above the Reserve Bank of India’s (RBI) tolerance band of 2-6%.
The RBI primarily factors in retail inflation while arriving at its bi-monthly policy.
The Monetary Policy Committee (MPC) of the Reserve Bank has been tasked by the government to control retail inflation at 4% (+, -2%) based on the Consumer Price Index (CPI).
A sharp rise in food and fuel prices – due to Russia’s invasion of Ukraine – pushed India’s overall inflation to an 8-year high of 7.79%. This was partially controlled in May after the government cut taxes on petrol, diesel and banned food exports.
However, food inflation, which accounts for almost half of the CPI basket, is growing at the fastest pace in 2 years.
The RBI has hiked interest rates by 90 basis points to 4.9% so far this year and is set to add more in the coming months.
Recently, RBI Governor Shaktikanta Das said that inflation is unlikely to fall within the top end of its mandated target band till December.
Even though the CPI numbers have eased since April, rising trade and current account deficit on account of global crude oil prices pushed the rupee to record levels against the US dollar. Thus, expressing concern over high imported inflation.