India’s retail inflation moderated to 2.82 percent in May from 3.16 percent in April, driven by significant easing in food prices. According to data released by the Ministry of Statistics and Programme Implementation, it is the lowest year-on-year inflation after February, 2019. Meanwhile, inflation in rural areas softened to 2.59 percent and at 3.07 percent in urban regions.

The food inflation rate for the last month, based on the All India Consumer Food Price Index, is provisionally reported at 0.99 percent, the lowest since October 2021, and further down from 1.78 percent recorded in April. Corresponding food inflation rate for rural areas stood at 0.95 percent against 1.85 percent in the previous month. Also, food inflation rate for urban areas witnessed decline from 1.64 percent in April to 0.96 percent in May.

According to the Ministry, the significant decline in headline inflation and food inflation during the last month is mainly attributed to a decline in the inflation of pulses and products, vegetables, fruits, cereals and products, households goods and services, sugar and confectionery, egg and the favourable base effect.