India consumer prices down to 7.31 percent in June amid easing food prices

Nathan Andrada – Fourth Estate Cooperative Contributor

New Delhi, India (4E) – Retail inflation in India fell as the Consumer Price Index (CPI) dropped to 7.31 percent in June compared with 8.28 percent in May, driven by moderation in prices of food, according to government data released Monday.

Monday’s report showed that retail food inflation climbed to 7.97 percent in June. The figure in the rural areas was at 8.68 percent, while it stood at 6.57 percent in the urban areas, according to figures from the Central Statistics Office.

However, the crisis in Iraq and prospects of the first drought in five years added to inflationary concerns, increasing the risk of higher food and fuel prices.

Meanwhile, earlier data showed that wholesale prices jumped 5.43 percent in June, the smallest rise in four months.

Weak rainfall in the country since the monsoon season began in June has already boosted prices of basic food products like tomatoes, potatoes and milk. The potential rise in inflation could prompt the Reserve Bank of India delay its decision to cut interest rates and ease lending in the country.

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