New DelhiThe retail inflation rate has increased due to the price of food items and vegetables. The retail inflation rate based on the Consumer Price Index has increased to 3.65 percent in the month of August. It had come down to 3.54 percent in the month of July. This was the lowest level of inflation in about five years. However, the inflation rate is still within the limit of four to six percent set by the Reserve Bank.
According to the data released by the government, the inflation rate of food items has increased to 5.66 percent as compared to 5.42 in July. However, if we look at it on a year-on-year basis, it has decreased a lot. In August last year, the inflation rate of food items was 9.94 percent. Urban inflation also increased from 2.98 percent to 3.14 percent on a month-on-month basis, while rural inflation increased from 4.10 to 4.16 percent.
During the recent monetary policy committee meeting, the Reserve Bank kept its inflation forecast for the current financial year at four and a half percent. It was the same earlier as well. Reserve Bank Governor Shaktikanta Das had said – Inflation is coming down, but the progress is slow and uneven. India’s inflation and growth rate are moving in a balanced manner, but it is important to be vigilant to ensure that inflation remains in line with the target.