Pushed up by food prices such as vegetables and fruits, Wholesale Price Index (WPI)-based inflation rose to 1.62 per cent in June, which was double the rate recorded (0.79 per cent) in each of the previous two months.
With retail inflation also inching up to a 22-month high of 5.77 per cent from 5.76 per cent, the Reserve Bank of India (RBI) may be prompted to maintain status quo on the policy rate in its monetary review next month. Official data released on Thursday showed the WPI index had cumulatively risen 3.82 per cent in FY17 for the months leading up to June. Compared with this, the rise was 1.70 per cent for the corresponding period in FY16. After rising for the first time in April after 17 straight months of contraction, wholesale inflation has consistently been pushed up by food inflation, which has steadily risen since February. It rose 8.18 per cent in June after a 7.88-per cent rise in May. Food inflation, the biggest component of the Consumer Price Index-based inflation, had also been responsible for retail inflation rising 7.38 per cent in June, against 7.20 per cent in May.