As the second wave of Covid-19 pandemic is still putting hurdles in the economy, India’s retail inflation eased slightly to 6.26% in June. It is above the Reserve Bank of India’s tolerance range (2% to 6%) for the second straight month.
According to the data compiled by the Ministry of Statistics and Programme Implementation and released on Monday showed that inflation was 6.3% in May. Inflation is calculated based on Consumer Price Index (CPI) and it remained high as the fuel prices were soaring putting pressure on food prices. Food inflation in June accelerated to 5.15% from 5.01% in May.
The fall in vegetables prices came down to only (-) 0.7% in June as compared with (-) 1.92% in the previous month. Meanwhile, the inflation rate in Food and beverages was at 5.58%. Inflation in ‘fuel and light’ category stayed high at 12.68% during the month as against 11.58 in the previous month.
The minutes of RBI’s June policy meeting showed that while it continues to focus on growth, the Monetary Policy Committee (MPC) would remain watchful on inflation.
Meawhile, Industrial output for the month of May rose 29.3% due to a low-base effect when compared with last year. The factory output, as measured by the Index of Industrial Production (IIP) contracted 33.4% in the same period last year as coronavirus-led lockdown wiped out economic activity.
Almost all the sectors under the IIP category registered a sharp growth in May, again due to the low-base effect. Manufacturing sector output, which accounts for more than three-fourths of the entire index, registered a growth of 34.5% as against a de-growth of (-) 37.8 per cent in the year-ago period.
Similarly, mining activity, which has a weight of over 14% in the overall index, saw 23.3% growth compared to a 20.4% contraction in the same month last year.
Electricity generation growth stood at 7.5% in May as against a fall of (-) 14.9% in the last year period.
(Compiled from the Ministry of Statistics and Programme Implementation information and Business Standard inputs)
