Retail inflation eased marginally to 7.01 percent in June compared to 7.04 percent in May, as per government data.
The headline inflation went down to 0.5 percent from 0.94 percent in May
The core inflation minus food and fuel segments is at 6 percent in June
The overall food inflation came is at 7.75 percent in June compared to 7.97 percent in May
The inflation rate for vegetables soared by 17.37 percent in June
However, pulses contracted to 1.02 percent in June
Fuel and light inflation hiked to 10.39 percent in the month of June as opposed to 9.54 percent in May
The number has, however, been above the Reserve Bank of India's (RBI) tolerance limit of 2-6 percent for the sixth month. This can be attributed to surging global commodity prices due to the Russia-Ukraine war and high crude oil prices.
The downward trend could be due to excise duty cuts on petrol and diesel along with imposed restrictions on food exports, according to The Economic Times. However, this is transitional as food prices continue to increase due to heatwaves.
The RBI has already raised interest rates by 90 basis points (bps) this year to 4.9 percent and is likely to increase it further in the coming months. RBI Governor Shaktikanta Das had said that inflation might not register a decline to its upper tolerance limit of 6 percent until December.
(With inputs from The Economic Times.)