InvestorQ : How is the inflation number for the month of August 2021?
ishika Banerjee made post

How is the inflation number for the month of August 2021?

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3 months ago
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The retail inflation or CPI inflation for the month of August 2021 touched a 4-month low level of 5.30%. This is comforting after inflation had crossed 6% for 2 months in succession. This inflation number is also well within the RBI comfort limit of 6%, although the actual inflation target is 4%. One must concede that this fall in inflation is also due to the base effect as in the same months last year, inflation was also tapering to lower levels.

CPI inflation was driven lower by food inflation; as in July. Food inflation fell further from 3.96% in July to 3.11% in August as supply chain gaps are being filled and solid MSP is getting more food crops to the market. The real positive tiding is that core inflation has also dropped below 6%. The only bugbear remains fuel inflation which is fairly elevated at 13%. However, lower headline inflation is positive for the RBI monetary stance.

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