Inflation rose for the sixth consecutive month in June
Retail inflation has risen for the sixth consecutive month, driven by increasing prices of food items, including potatoes and ginger. It reached 4.38% in June, up from 2.74% in January and 3.93% in May.
This marks the first time since January 2025 that inflation has surpassed the Reserve Bank of India’s (RBI) midpoint target of 4%. The Ministry of Statistics and Programme Implementation released these inflation figures on Monday, January 13.
Food Inflation Rose to 5.32% in June 2026
Food inflation—the rate of price increase for food items—climbed to 5.32% in June, up from 4.38% in May 2026.
Rising Inflation Raises Fears of Interest Rate Hikes
Although current inflation remains within the RBI’s tolerance band of 2% to 6%, further price increases could compel the central bank to raise interest rates. Such a move could impact the country’s economic growth in the coming quarters.
In June, the RBI had already raised its inflation forecast from 4.6% to 5.1%, citing the dual risks of a potential monsoon deficit due to El Niño conditions and rising energy prices.
No Year-on-Year Comparison Due to New Index
The current inflation data cannot be compared with the corresponding period last year because the index was reset in January of this year. A new series was launched with 2024 as the base year, recording a revised retail inflation rate of 2.74% in January.
Subsequently, a steady rise in prices was observed: 3.21% in February, 3.4% in March, 3.48% in April, and 3.93% in May. Under the old CPI series with a base year of 2012, the inflation rate stood at 1.33% in December and 0.71% in November.
