Mumbai, Aug 15:Ā Retail inflation in India rose sharply in July to 7.44 per cent and in the process breached RBI’s 6 per cent upper tolerance target, largely due to a sharp spurt in vegetable, fruits, and pulses prices. The inflation index for rural and urban was 7.63 per cent and 7.20 per cent, respectively. In June too, the overall retail inflation too rose considerably to 4.81 per cent, largely due to a sharp spurt in vegetable prices. Back in May, the retail inflation was at 4.25 per cent, hitting a two-year low. It was at 4.7 per cent in April and 5.7 per cent the previous month. According to the Ministry of Statistics and Programme Implementation data released Monday, the provisional index number for vegetables rose from 181.1 in June to 250.1 in July. Vegetables have a 6.04 per cent weightage on the overall retail inflation. For fruits and pulses, they rose from 172 and 223.1 to 179.7 to 231.1, respectively. The rise in inflation could partly be attributed to the current spurt in tomato and other vegetable prices across India.
The rise in tomato prices is reported across the country, and not just limited to a particular region or geography. In key cities, it rose to as high as Rs 150-200 per kg. Amid a sharp spurt in tomato prices across the country, the Central government had directed its agencies ā NAFED and NCCF — to immediately procure the staple vegetable from mandis in key growing states of Andhra Pradesh, Karnataka, and Maharashtra. Notably, retail inflation (Consumer Price Index) in India peaked at 7.8 per cent in April 2022, driven by a reduction in food and core inflation. In some advanced countries, inflation had in fact touched a multi-decade high and even breached the 10 per cent mark. RBI’s consistent monetary policy tightening since mid-2022 could be attributed to the substantial decline in inflation numbers in India. India’s retail inflation was above RBI’s 6 per cent target for three consecutive quarters and had managed to fall back to the RBI’s comfort zone only in November 2022.