India’s retail inflation moderated to eight year low of 1.55 per cent in July, down from 2.1 per cent in June. According to data released by the Ministry of Statistics and Programme Implementation, it is the lowest year-on-year inflation rate after June, 2017.

 

 

Meanwhile, inflation in rural areas softened to 1.18 percent and at 2.05 percent in urban regions. The food inflation rate, based on the All India Consumer Food Price Index, slipped deeper into deflation at 1.76 per cent in July, the lowest since January 2019. Corresponding food inflation rate for rural areas also decelerated to 1.74 percent while urban areas also witnessed deflation, standing at 1.9 percent during last month.

 

 

According to the Ministry, the significant decline in headline inflation and food inflation during the month of July is mainly attributed to favorable base effect and to decline in inflation of Pulses and Products, Transport and communication, Vegetables, Cereal and products, Education, Egg and Sugar and confectionery.