June's retail inflation data for India to come out today

12 Jul 2022 , 11:26 AM

The Reserve Bank’s next bi-monthly monetary policy will be issued in early August, and it will take into account the vital statistics on June retail inflation that the government will provide on Tuesday (12-07-2022).

Retail inflation has been above 6% since January of this year, causing the central bank to raise policy rates twice in a row (repo).

Given the high commodity prices brought on by the ongoing Russia-Ukraine war, retail inflation based on the Consumer Price Index (CPI), which was 7.04% in May, is unlikely to fall below the Reserve Bank of India’s comfort level of below 6 percent anytime soon.

The National Statistical Office (NSO), Ministry of Statistics and Programme Implementation, is expected to release the CPI statistics at 5.30 in the evening.

The benchmark repo rate, at which the Reserve Bank loans short-term money to banks, was sharply increased by 0.50% to 4.90% last month as part of its bimonthly monetary policy review in an effort to stabilize spiraling prices. It came after the central bank raised the repo rate by 0. 40% during an off-cycle meeting on May 4.

Shaktikanta Das, governor of the RBI, expressed optimism that the price situation will progressively improve in the second half of the current fiscal year while addressing the Kautilya Economic Conclave on Saturday. He said that the central bank will keep using monetary policies to underpin inflation in order to achieve strong and long-lasting growth.

The central bank would take steps to preserve and promote macroeconomic stability, according to the governor, who stressed that price stability is essential to sustaining both macroeconomic and financial stability. The Reserve Bank, which takes the CPI into account when determining its monetary policy, increased its inflation prediction for the current fiscal year from 5.7 to 6.7% in June.