MUMBAI: India’s retail inflation, measured by the Consumer Price Index (CPI), rose to eight months high of 4.82% in August, primarily due to higher food and fuel prices, thereby breaching the Reserve Bank of India’s medium-term target of 4%.
While urban inflation stood at 4.31%, rural inflation stood at 5.2%.
As per the latest data released by the Ministry of Statistics and Programme Implementation on Monday, higher prices of cereals, sugar, milk and other essential food items have contributed to the increase in household expenses, while elevated global crude oil prices have added to fuel and transportation costs.
Food inflation has emerged as a key driver of the rise in the headline number, as it rose by 5.66% due to erratic weather conditions and supply-side disruptions affecting prices of several agricultural commodities.
The rise in fuel costs has also increased the risk of inflationary pressures spilling over into other sectors through higher transportation and input costs.
Higher inflation was not restricted to food; rather, the hospitality sector also witnessed a significant rise. Inflation in restaurants and accommodation services rose by 8.38 % in August, while transport inflation stood at 4.60 %.
Personal care, social protection and miscellaneous goods and services recorded the highest inflation of 15.17 %.
Among states, Telangana has the highest retail inflation as it stood at 6.27%, breaching RBI's tolerance band of 6%, followed by Tamil Nadu, where it stood at 5.9%.
