The noteworthy increase in inflation has been on account of elevated prices in food, pan, tobacco and miscellaneous segments. Core inflation also scaled a 21-month high at 5.9 per cent for July 2020 and this is the fourth consecutive month of pick-up. Rural inflation at 7 per cent has marginally outpaced inflation in the urban regions (6.8 per cent) in July.
Story: Shivani Sharma
Design: Pragati Srivastava
Retail inflation for July 2020 rose to a 4-month high of 6.9 per cent breaching the upper band of the RBI's inflation target (4 per cent with +/- 2 per cent) for the fourth consecutive month.
Inflation in food and beverages rose to a 4-month high of 8.7 per cent in July 2020, higher than 2.3 per cent in the corresponding month of FY19 and 7.9 per cent in June 2020. The inflationary pressure in this component can be attributed to supply disruptions owing to localised lockdowns announced in states across the country in July.
Inflation in pan, tobacco and intoxicants has surged to its highest level at 12.4 per cent since April 2012, higher than 11.3 per cent recorded in June 2020.
Clothing and footwear inflation at 2.9 per cent in July 2020 has marginally increased from 2.7 per cent in June and 1.4 per cent in corresponding month last year.
Inflation in housing remained at 3.3 per cent in July, marginally lower than 3.5 per cent recorded in June.
Inflation in case of fuel components rose marginally to 2.8 per cent in July as against 0.5 per cent in June largely on account of increase in fuel prices during the month.
Inflation in the miscellaneous component scaled to an 88-month high of 7 per cent in July compared with 6.1 per cent in the last month. This notable increase has been on account of significant inflationary pressure recorded in transportation and personal care products.