India June retail inflation hits 4.38%, breaching RBI target

India's retail inflation accelerated to 4.38 percent in June, breaching the Reserve Bank of India's medium-term target of 4 percent for the first time in 17 months, according to official data released on July 13. The increase from 3.93 percent in May was driven primarily by rising food and fuel prices, placing renewed pressure on policymakers and household budgets.

The Consumer Price Index (CPI) data, published by the Ministry of Statistics and Programme Implementation, showed food inflation rose to 5.32 percent in June from 4.78 percent in May. Specific items saw sharp annual price increases, including ginger (50.41 percent), tomatoes (31.92 percent), and raisins (20.52 percent). Inflation for precious metals and jewelry also remained elevated. Conversely, prices for potatoes, peas, and some vehicles declined compared to a year earlier.

Economists attributed the uptick to several factors, including geopolitical tensions affecting global energy prices, volatile domestic fuel costs, and uneven monsoon rainfall creating pressure on food supply chains. Transport inflation surged to 4.31 percent in June from 1.75 percent in May, reflecting the full pass-through of recent petrol and...