India’s retail inflation surged to a nine-month high of 5.49% in September, driven by rising food prices, according to government data released on October 14. This marks a significant increase from 3.65% in August and is the highest rate since December 2023, when it reached 5.69%.
Food inflation played a crucial role in this rise, climbing to 9.24% compared to 5.66% in the previous month. The Ministry of Statistics and Programme Implementation (MoSPI) noted that food inflation has been a persistent challenge, with previous months showing similar trends—5.42% in July, 9.36% in June, and 8.69% in May.
Despite the increase, the inflation rate remains within the Reserve Bank of India’s (RBI) medium-term target range of 2-6%, indicating that while prices are rising, the situation is not yet alarming from a monetary policy perspective. The RBI has been monitoring these trends closely, especially as they relate to its inflation targets and economic forecasts for the upcoming quarters.
The rise in CPI inflation reflects broader economic conditions and challenges, particularly in the food sector, which constitutes a significant portion of consumer spending in India.
