Inflation based on wholesale prices declined for the second consecutive month in June to a nearly two-year low of 2.02%, government data showed on Monday. The easing in inflation was led by a lower pace of price rise for vegetables and fuel and power items.
Wholesale price inflation was at 2.45% in May and 3.24% in April. In June 2018, the inflation was at 5.68%. The inflation in June was the lowest since July 2017, when it was recorded at 1.88%.
Prices of food articles eased 6.98%, compared to 6.99% in May. Inflation in vegetable prices reduced to 24.76% in June, down from 33.15% in May. Potatoes were 24.27% cheaper in June as compared to the same month a year ago. Onion prices, however, continued to rise with a 16.63% inflation rate in June, higher than 15.89% recorded in May.
Prices in the “fuel and power” category fell 2.20% in June, against a rise of 0.98% in May. Inflation in manufactured items reduced to 0.94% in June against 1.28% in May.
Data released last week showed that retail prices had risen 3.18% in June. The Reserve Bank of India, which considers retail inflation to decide monetary policy, had lowered the repo rate, or the interest rate at which it lends to commercial banks, in June by 25 basis points to 5.75% – the lowest in nine years.
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