Retail inflation at 8-month high
Rural India was hit hardest by the high inflation for the second month in the Consumer Price Index (CPI) in June 2015 at 5.4 per cent with the food inflation leading the increase for the second month in succession and eight-month high.
Mumbai: Rural India was hit hardest by the high inflation for the second month in the Consumer Price Index (CPI) in June 2015 at 5.4 per cent with the food inflation leading the increase for the second month in succession and eight-month high.
The rise in prices was much sharper than in urban areas. “The gap between urban and rural inflation widened to 1.52 per cent, widest in the entire series,” says Dhananjay Sinha, head research, Emkay Global Financial Services.
The reason behind widening gap was due to sharper increase in food prices particularly pulses in the rural areas. The overall food price index increased sharply to 5.5 per cent YoY from 4.8 per cent in May, driven by significant inflation in pulses (22.2 per cent) and resurgence in vegetable inflation (5.4 per cent).
Prices of pulses have been rising in response to lower acreage but this is expected to be rectified as the minimum support price (MSP) has been increased. Urban inflation mildly rose to 4.6 per cent in June YoY from 4.4 per cent in the previous month. Major increase in headline number came in through resurgence of transportation inflation and sharp increase in prices of pulses.
( Source : deccan chronicle )
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