Mumbai: The food prices are projected to cool off in the coming months and the inflation trajectory to soften and stabilise between 4 and 4.5 per cent, industry experts have said.
India’s consumer price inflation (CPI) edged up to 5.08 per cent in June this year compared to the same period last year.
According to industry experts, although June rains were deficient, it is not a major concern because July and August rains are what matter for Kharif.
“We expect the progress on monsoons and pick up in sowing to improve agricultural output and cool off food inflation in the coming months,” said Dharmakirti Joshi, Chief Economist, Crisil.
Non-food inflation eased for the 17th straight month, sliding to a record low of 2.3 per cent.
“Net-net, we expect a decline in food inflation in the coming months to drag down headline inflation to an average of 4.5 per cent. That said, no rate cuts are expected in the forthcoming policy as RBI pursues a target of 4 per cent durable inflation,” Joshi explained.
Inflation had eased to a 12-month low of 4.75 per cent in May after having come down to 4.83 per cent in April, which was an 11-month low.
The June figures mark a break from the declining trend that had set in during recent months.
According to Sanjeev Agrawal, President, PHD Chamber of Commerce and Industry (PHDCCI), CPI inflation for the month of June is majorly stoked by the food and beverages inflation rising from 7.9 per cent in May to 8.4 per cent in June.
