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Informist, Wednesday, Aug. 12, 2026

 

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--India Jul CPI inflation 4.45%
--India Jul CPI inflation 4.45% vs 4.38% June
--Informist Poll estimated India July CPI inflation at 4.4%
--India July CPI food inflation 5.52% vs 5.32% Jun
--India July CPI rural inflation 4.84% vs 4.74% Jun 
--India July CPI urban inflation 3.96% vs 3.93% Jun 
--India July CPI food and beverages inflation 5.24% vs 5.05% Jun
--India July CPI 'paan, tobacco, and intoxicants' inflation 4.79% vs 4.83% Jun
--India July CPI clothing and footwear inflation 3.38% vs 3.23% Jun 
--India July CPI housing and utilities inflation 2.16% vs 1.99% Jun 
--India Jul CPI furnishings, household equipment inflation 2.40% vs 2.19% Jun 
--India July CPI health inflation 1.34% vs 1.42% Jun 
--India July CPI information and communication inflation 0.63% vs 0.43% Jun 
--India July CPI recreation, sport, and culture inflation 1.64% vs 1.75% Jun 
--India July CPI educational services inflation 3.64% vs 3.34% Jun 
--India July CPI restaurants, accommodation svcs inflation 7.72% vs 6.91% Jun 
--India July CPI personal care, miscellaneous inflation 14.77% vs 16.72% Jun
--India July CPI general index up 0.9% on month 
--India July CPI food price index up 2.1% on month 
--India July CPI core inflation 3.9% vs 4.1% Jun
--India July CPI inflation of 4.45% highest in 19 months

 

NEW DELHI – India's retail inflation, based on the CPI, rose to a 19-month high in July due to higher food and restaurant services inflation, mainly impacted by higher prices amid the West Asia war, data released Wednesday by the statistics ministry showed. Headline inflation rose to 4.45% on year in July from 4.38% in June, topping the Reserve Bank of India's medium-term target of 4% for the second consecutive month.

 

The CPI inflation print was largely in line with economists' expectations. Economists polled by Informist saw the headline inflation at 4.4% in July. Retail inflation was 1.62% in July last year based on the new CPI series with 2024 as the base year.

 

The food price index was up 2.1% on month in July, while the general index rose 0.9% month-on-month from June. Core inflation, which excludes food and fuel items, moderated to 3.9% in July from 4.1% in June.

 

Food inflation rose to 5.52% on year from 5.32% in June. Ginger, garlic and onion were among the key items with high inflation at an all-India level in July. Ginger inflation rose to 83.62% in July from 50.41% in June, garlic inflation increased to 35.36% from 17.93%, and onion inflation rose to 22.54% last month from 4.73% in June.

 

Food and beverages inflation rose to 5.24% in July from 5.05% a month ago. Inflation in restaurants and accommodation services rose to 7.72% from 6.91% in June. Within this, food and beverage serving services inflation climbed to 7.75% last month from 6.94% in June.

 

Transport inflation was 4.43% last month, up from 4.31% in June, as an outcome of the war which has disrupted the global supply chain and hiked commodity prices. Transport services for goods also inched up to 7.77% in July from 7.70% a month ago.

 

Inflation in the housing, water, electricity, gas and other fuels segment rose to 2.16% from 1.99% in June. Electricity, gas, and other fuel inflation rose to 2.02% in July from 1.75% a month ago.

 

Educational services inflation, which has been seeing a rising trend for the past few months, rose to 3.64% in July from 3.34% in June. Inflation in personal care, social protection, and miscellaneous goods and services moderated to 14.77% in July from 16.72% in June. However, the category continued to show the highest inflation within the basket. Silver jewellery inflation was 109.84% in July, down from 133.21% in June. Gold, diamond, and platinum jewellery inflation slipped to 32.98% from 36.82%.

 

That said, the July print in the personal care segment was the softest in seven months and helped limit the upside in the headline rate, Miguel Chanco, chief Emerging Asia economist at Pantheon Macroeconomics, said in a note.

 

At 4.84%, rural inflation in July continued to be higher compared to urban inflation at 3.96%. In June, rural inflation was 4.74% and urban inflation 3.93%.

 

Among states and Union territories, Telangana, Andhra Pradesh, Tamil Nadu, and Puducherry reported the highest inflation in June at 6.32%, 5.72%, 5.44%, and 5.41%, respectively. Mizoram at 1.84%, Meghalaya at 2.31%, and Tripura at 2.32% reported the lowest inflation.

 

INFLATION OUTLOOK

Going forward, ICRA projects CPI inflation to harden to 4.7% in August. The headline inflation figure is expected to cross the 5% mark in September, as the base effect turns unfavourable, Aditi Nayar, chief economist at ICRA, said in a note.

 

Adding to this, Chanco said the Reserve Bank of India's inflation target range of 2-6% still looks very secure, with Pantheon Macroeconomics' revised inflation outlook implying a peak in the headline rate at 5.3% in October.

 

ICRA sees CPI inflation averaging 5% in 2026-27 (Apr-Mar), in line with the RBI's Monetary Policy Committee's forecast, with the prolonging of tensions in West Asia and monsoon outturn posing risks to the upside. "In our view, while immediate policy tightening is unlikely, elevated inflation projections for Q3 (Oct-Dec) FY2027 through Q1 (Jan-Mar) FY2028, suggest that the next move on rates is going to be a hike," Nayar said. "Evidence of a generalisation in inflationary pressures in the next few months could result in a rate hike in the December 2026 meeting."

 

On Aug. 5, the Reserve Bank of India trimmed its headline inflation outlook for FY27 by 10 basis points to 5.0% even as El Nino and West Asia war-led uncertainties continue to linger. Volatile oil prices and their second-round effects continue to pose downside risks, RBI Governor Malhotra said, adding that inflation was seen rising in the near term. The central bank also cut the inflation forecast for Jul-Sept by 40 bps to 4.7%.

 

The following table details the general index of the CPI and inflation for July:

 

	Weight	Index for July	Month-on-month change (in %)	Inflation for July	Inflation for June
Food and beverages	36.75	109.1	2.0	5.24%	5.05%
Paan, tobacco and intoxicants	2.99	108.18	0.2	4.79%	4.83%
Clothing and footwear	6.38	108.45	0.4	3.38%	3.23%
Housing, water, electricity, gas and other fuels	17.67	103.85	0.3	2.16%	1.99%
Furnishings, household equipment and routine household maintenance	4.47	105.21	0.4	2.4%	2.19%
Health	6.1	104.75	0.2	1.34%	1.42%
Transport	8.8	105.63	0.2	4.43%	4.31%
Information and communication	3.61	104.26	0.2	0.63%	0.43%
Recreation, sport and culture	1.52	104.49	0.1	1.64%	1.75%
Education services	3.33	108.58	1.0	3.64%	3.34%
Restaurants and accommodation services	3.35	112.68	1.1	7.72%	6.91%
Personal care, social protection and miscellaneous goods and services	5.04	123.51	(-)1.0	14.77%	16.72%
Consumer Food Price Index	34.78	109.39	2.1	5.52%	5.32%
All India	100	107.94	0.9	4.45%	4.38%

 

Source: Ministry of Statistics and Programme Implementation.

 

End

 

Reported by Shweta

Edited by Avishek Dutta

 

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