Retail inflation at 5-month low of 5.05% in August

Retail inflation eased to a five-month low of 5.05% in August, mainly because of a slower rate of price increase in vegetables as well as food and beverages. The rate of price growth, based on the consumer price index (CPI), was the lowest since March 2016 when it stood at 4.83%.

In the preceding month July, CPI inflation was at a nearly two-year high of 6.07%. In August 2015, the rate of price rise was 3.74%. Lower inflation in vegetables in August helped as the rate of price rise stood at a mere 1.02% against 14.06% in July, government data showed on Monday.

Food and beverage prices remained sticky as they grew 5.83% in August in comparison to 7.96% in July. However, the overall consumer food inflation in August fell to 5.91% as against 8.35% in July. Pulses roiled the scene at an inflation print of 22.01% against 27.53% in July.

However, a majority of food items covered by the Ministry of Statistics and Programme Implementation (MOSPI) to measure retail inflation showed a firm trend during the month. Cereals and products turned costlier, with inflation at 4.11%. The readings for eggs came in at 9.58%, milk and products 4.36% and oil and fat 4.94%.

Among others, the rate of price rise in fruits was at 4.46%. CPI inflation in August for the urban segment was 4.22% while that of rural areas read 5.87%.