The CPI inflation has been showing signs of softening since March, expect for June when it inched up marginally. As per the government data, inflation in the food and beverages segment eased to 11.06 percent in August as against 11.24 percent in the previous month.
However, there was no reprieve in vegetable prices as they increased by 26.48 percent as against inflation of 16.4 percent in July. Though there was softening in the prices of fruits in August month-on-month. Inflation in milk and milk products, clothing, bedding and footwear segments also softened month on month.
The decline in retail inflation comes days ahead of the Reserve Bank's mid-quarter monetary policy review on September 20. The central bank keeps a close watch on the inflation data to decide its monetary policy.
The data further revealed that retail inflation rates for rural and urban areas in August stood at 8.93 percent and 10.32 percent, respectively. For CPI inflation, price data are collected from selected towns by NSSO and from selected villages by the Department of Posts.