<p>Retail inflation softened to 6.71% in July due to moderation in food prices but remained above the Reserve Bank’s comfort level of 6% for the seventh consecutive month.</p>.<p>With retail inflation continuing to remain high despite a fall in prices of vegetables and edible oils, among other commodities in July, the Reserve Bank of India (RBI) might go for another rate hike in September.</p>.<p>The Consumer Price Index (CPI) based retail inflation was at 7.01% in June and 5.59% in July 2021. It was above 7% from April to June this fiscal.</p>.<p>According to the data released by the National Statistical Office (NSO) on Friday, food inflation in July moderated to 6.75% as against 7.75% in June.</p>.<p>Meanwhile, the moderation in retail inflation in July was mainly due to the easing of vegetable and edible oil prices. In the case of ‘fuel and light’, the prices remained high.</p>.<p>“CPI headline inflation for July has moderated in line with our expectations led largely by food inflation while the core inflation remains elevated and sticky. The coming few readings are<br />expected to be a tad above 7% with inflation likely to hover above RBI’s upper threshold limit of 6% until January 2023. We expect repo rate at 6% by end of 2022 followed by a pause and a shift to neutral policy stance,” Upasna Bhardwaj, Chief Economist, Kotak Mahindra Bank, said.</p>.<p>According to Vivek Rathi, Director-Research, Knight Frank India, headline inflation softened to 6.7% in July primarily due to softening of food prices. “The increase in fuel inflation despite measures to curb domestic petrol and diesel prices is a concerning factor,” he said.</p>.<p><em>(With PTI inputs)</em></p>
<p>Retail inflation softened to 6.71% in July due to moderation in food prices but remained above the Reserve Bank’s comfort level of 6% for the seventh consecutive month.</p>.<p>With retail inflation continuing to remain high despite a fall in prices of vegetables and edible oils, among other commodities in July, the Reserve Bank of India (RBI) might go for another rate hike in September.</p>.<p>The Consumer Price Index (CPI) based retail inflation was at 7.01% in June and 5.59% in July 2021. It was above 7% from April to June this fiscal.</p>.<p>According to the data released by the National Statistical Office (NSO) on Friday, food inflation in July moderated to 6.75% as against 7.75% in June.</p>.<p>Meanwhile, the moderation in retail inflation in July was mainly due to the easing of vegetable and edible oil prices. In the case of ‘fuel and light’, the prices remained high.</p>.<p>“CPI headline inflation for July has moderated in line with our expectations led largely by food inflation while the core inflation remains elevated and sticky. The coming few readings are<br />expected to be a tad above 7% with inflation likely to hover above RBI’s upper threshold limit of 6% until January 2023. We expect repo rate at 6% by end of 2022 followed by a pause and a shift to neutral policy stance,” Upasna Bhardwaj, Chief Economist, Kotak Mahindra Bank, said.</p>.<p>According to Vivek Rathi, Director-Research, Knight Frank India, headline inflation softened to 6.7% in July primarily due to softening of food prices. “The increase in fuel inflation despite measures to curb domestic petrol and diesel prices is a concerning factor,” he said.</p>.<p><em>(With PTI inputs)</em></p>