AMN
India’s headline retail inflation rate crashed past the upper bound of the Reserve Bank of India’s (RBI) 2-6 percent tolerance range in July and shot up to a 15-month high of 7.44 percent, spurred on by a massive increase in vegetable prices, data released by the Ministry of Statistics and Programme Implementation on August 14 showed.
The Consumer Price Index (CPI)-based inflation rate jumped to 7.44 per cent year-on-year (Y-o-Y) in July from 4.87 per cent in the preceding month, data released by the National Statistical Office showed. This was sharply higher than analysts’ expectations and forecasts in Reuters poll (6.4 per cent) and Bloomberg survey (6.5 per cent). Retail inflation also breached the Reserve Bank of India’s upper tolerance level of 6 per cent for the first time in five months.
Separately, trade data released by the commerce ministry showed merchandise exports contracted for a sixth consecutive month in July, by 15.9 per cent Y-o-Y to $32.25 billion. Imports declined for a seventh month in a row, by 17 per cent to $52.9 billion, leading to a trade deficit of $20.7 billion.
Prices of vegetables, led by tomatoes, shot up 37.3 per cent annually in July, while pulses, cereals, and spices witnessed double-digit inflation rates.