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Retail inflation rises to 6.93% in July on higher prices of food items

14 Aug 2020 Evaluate

Retail inflation based on Consumer Price Index (CPI) rose to 6.93% in July 2020, mainly on account of higher prices of food items. The retail inflation remained above the Reserve Bank of India’s (RBI’s) comfort level. The government has mandated the Central Bank to restrict the inflation at 4% (+, - 2%). The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that CPI for Rural and Urban stood at 9.89% and 9.05%, respectively. Besides, the CPI for the month of June was revised to 6.23% from 6.09%.

The Consumer Food Price Index (CFPI) or the inflation in the food basket surged to 9.62% in the month of July. The CFPI for June too was revised to 8.72% from 7.87%. The rise in inflation was mainly due to a rise in pulses and products prices that saw a 15.92% on-year rise in July. Apart from pulses and products segment, the meat and fish segment saw a rise of 18.81%, while that of oils and fats rose 12.41% and spices prices gained 13.27%. The vegetables segment also witnessed a rise of 11.29%.

National Statistical Office said the price data are usually collected from selected 1114 urban markets and selected 1181 villages through personal visits by field staff of Field Operations Division of NSO on a weekly roster. It added that as the various pandemic related restrictions were gradually lifted and non-essential activities started resuming operations, availability of price data has also improved. NSO collected prices from 1054 (95%) urban markets and 1089 (92%) villages during the month of July.

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