Consumer Price Index inflation rose to 3.18% in June, government data showed on Friday. Retail inflation in the month of May was 3.05%.
Retail inflation in rural areas rose from 1.86% in May to 2.21% in June. In urban areas, it rose from 4.33% to 4.51%. Consumer food price inflation stood at 2.17% in June compared to 1.83% in May.
Prices of meat and fish rose the most, at 9.01% in June. Prices of health products rose by 8.22%. On the other hand, prices of fruits fell by 4.18%.
“Food inflation trend is upwards while core is downwards, so the overall outlook on inflation is benign,” Sujan Hajra, chief economist at Anand Rathi Securities said according to the Hindustan Times. “The RBI [Reserve Bank of India] will continue to maintain its accommodative stance and could do another 25-50 basis points rate cuts in this financial year.”
Industrial output
Meanwhile, India’s industrial output grew at 3.1% in May over the corresponding month last year, the Ministry of Statistics and Programme Implementation said in a press release. This was lower than the 3.4% recorded in April.
The mining sector grew at 3.2%, the manufacturing sector at 2.5% and electricity at 7.4% in May. In all, 12 out of 23 industry groups in the manufacturing sector showed positive growth.
The item “Manufacture of wood and products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials” showed the highest positive growth at 24.8%, followed by manufacture of food products at 15.9%. On the other hand, manufacture of paper and paper products declined by 12.2%.
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