Consumer Price Index (CPI)-based inflation remained above the RBI's comfort level for the second successive month despite slipping slightly to 6.26 percent in June while the factory output recorded a growth of 29.3 percent in May, mainly on account of the base effect, the government data showed.
The marginal slippage in the Retail inflation was noticed despite little firmness witnessed in the food inflation which inched up to 5.15 percent in June from 5.01 percent a month ago. Retail inflation based on CPI was 6.3 percent in May 2021 and 6.23 percent in June 2020. As regards the factory output, the Index of Industrial Production rose sharply by 29.3 percent in May against a decline of 33.4 percent in the corresponding month of 2020. As per the data released by the National Statistical Office (NSO) on June CPI, the inflation on annual basis in the 'oils and fats' segment was 34.78 percent in June.
While the rate of price rise in fruits basket was 11.82 percent, it contracted in vegetables (-0.7 percent). The inflation in 'fuel and light' segment was 12.68 percent. The RBI has been mandated by the government to keep retail inflation at 4 percent with a margin of 2 percent on the either side.
The NSO data revealed that industrial production surged by 29.3 percent in May, mainly due to low-base effect and good performance by manufacturing, mining and power sectors, but remained below the pre-pandemic level. The manufacturing sector grew 34.5 percent in May this year, as per the data released by the NSO on Monday.
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