India’s retail inflation edged up to 2.07% in August, compared with 1.61% in July, as higher prices of kitchen essentials such as vegetables, meat, fish, and eggs pushed the consumer price index (CPI) higher, according to official data released Friday.
The uptick comes after nine straight months of decline, with inflation having eased steadily since November 2024. On a year-on-year basis, however, price pressures remain significantly softer. Retail inflation stood at 3.65% in August 2024, nearly double the latest reading.
Economists attribute the mild rebound largely to food price volatility, a common seasonal driver of inflation in India. Non-food components, including fuel and core categories, remained relatively stable.
At 2.07%, headline inflation remains well below the Reserve Bank of India’s (RBI) upper tolerance band of 6%, leaving policymakers with room to maintain a supportive monetary stance. However, analysts caution that sustained food price pressures could limit the extent of policy easing in the months ahead.
The latest data suggest that while India continues to enjoy one of the lowest inflation environments in recent years, kitchen budgets are beginning to feel the pinch, a reminder of the country’s sensitivity to food-driven price cycles.
